https://declassified.library.utoronto.ca/files/original/90939a23b99c938ce675a5ff083f2c66.pdf 8d9cb09e294d1a4eb35b941f8cdd2073 PDF Text Text Document disclosed under the Access to Information Act Document divulgue en vertu de la Loi sur I'acces a I'information -.» TOP SECRET (PAGES 13-15: CANADIAN EIES ONLI) JIC 116 (54) 14 Sep 54 Copy No. -o SEMI-ANNUAL . ^(February - August 1954)- ry* y *y i \ 7 s 7 7 y - r > l t$0O*2f-P-<£6 >• Introduction 1. This paper summarize^ important developments that have been observed during the past six months in the Soviet Union, in troubled areas of the world and in the international Communist movement* It attempts to discern and discuss trends of Soviet policy of significance in the conduct of the Cold War, and to provide a semi-annual "stock-taking" of the state of our knowledge of the Soviet Union and its policies. Internal Developments in the Soviet Union Internal Politics 2. It does not appear that the present emphasis on collective leadership will change very greatly in the next year or so. Malenkov as head of the Government appears to be senior but not undisputed master. At the moment, however, there seems to be a more even balance in ambition, ability and influence among the top five or six leaders and the regime seems to be able to provide for the present the Soviet Union with"a relatively stable.government. In the event that a struggle for supreme power should emerge in the immediate future, recent evidence of differences in personality and in approach to current problems suggest that the two main contenders would probably be Malenkov and Khrushchev. The likelihood of this is suggested partly by the fact that Khrushchev, whose position as First Secretary in the Party Secretariat provides opportunities? £or aggrandizement of power, seems to have been given chief responsibility for dealing with what is at present the most important economic problem, that of agricultural production. The success or failure of his efforts in this field will very likely determine whether or not he retains-Ms powerful position in the Party. In the event of failure to live up to the promises made last year, many of which depend directly on a substantial improvement of agricultural production, the collective leadership might, in its search for a scapegoat, be presented with its greatest internal crisis. ^y 3* If, for the time being, there seems to be a balance among the leaders controlling Party and Government, the next question is whether two other forces of considerable importance in any authoritarian state, the police and the army, have increased their power in recent months. 4* So far as the security agencies are concerned, the answer seems to be that they are clearly under the thumb of the Party. A few months ago the M.V.D., with which the M.G'iB. Ministry of State Security was amalgamated in April 1953* Was split into two sections, one retaining the title M.V.D. and controlling uniformed police, border troops and labour camps and the other the K.G.B. (Committee of State Security) responsible for espionage, counter espionage and subversion. The two chiefs, Serov and Kruglov, do not appear to be in the top ranks of Government leaders. TOP SECRET 00298 7 �Document disclosed under the Access to Information Act - Document divuJeiUkMUMtf de la Loi sur I'acces a I'information TOP SECRET • S S B S 5. The Influence of the army on Government policy has, to all appearances, remained an important one in recent months. The trend toward the assumption by army leaders of more influential positions in Government began last year, chiefly after the"fall of Beria, and this trend has been maintained. The army has not, of course, evolved a separate centre of power capable of bargaining with Party ,or Government. Its influence is felt rather through individuals who have been given influential positions* There has been no evidence to suggest that any significant section Of the armed forces is disloyal to Communism or that any senior officer or group of officers contemplate gaining complete power within the Communist state. 6. Within the Government itself the only recent structural change of general significance has been the splitting up of a number of Ministries. The total number now, fifty-five, comes close to the number created by Stalin in the year before he died. After his death, the number was drastically reduced. It had been supposed that Stalin preferred to distribute governing responsibilities in order to render more secure his own unique position of power at the top. The Malenkov Government has now done much the same thing under the pretext of rendering more efficient the operations of Government. This wide distribution of governing responsibilities would seem to require tighter control from some point at the top. It seems most likely at present that this control would be exercised by the Party through its own structure. We do not know whether this would mean an addition to the real power of Khrushchev as the head of the Secretariat or whether Malenkov and the others in the Presidium of the Central Gommittee will exercise the effective control of important decisions carrying out its policies simultaneously through Party and Government. 7* The comments above on internal conditions in the Soviet Union have referred only to the question of effective control at the top of the state.., There remain the questions of current relations between the Russians and the Other nationalities in the Soviet Union. There is little that is new to vdte on either of these subjects since early in the year. The country had the usual Gommunist style election in March and the list of candidates proposed to the electorate received over 99$ of the votes. Whatever modifications there may have been in the system of the personal autocracy of one man among the leaders at the top, there has been no appreciable modification in the absolute authority of the Party and the Government over the people. Malenkov and Khrushchev have travelled among the people and have apparently tried to leave the impression that they were much more accessible to the average citizen and aware of his feelings than was Stalin. The reiteration of promises of an improvement in the standard of living has also indicated, from the political standpoint, a desire to impress the people favourably. There has been no indication that the Government wished to impress the people by promising anything resembling the democracy of the West nor indeed that the people have any great desire for this. A long period of peace both externally and Internally and easier lives are what the people want and any accomplishments in this direction will be welcomed without consideration of the fact that it Is a completely authoritarian government which provides them. 8. The relations between the leaders and the small but important group of officials and intelligentsia indicate, on the whole, an easier atmosphere in which seme divergences in opinion are.accepted, and a little more sophistication, satirical criticism and humour encouraged in the arts. The general pattern has, however, been contradicted from time to time in recent months by oppressive acts, and reversions to unimaginative orthodoxy in the style of Stalin. The present leaders are probably prepared to leave divergences in the arts and in theoretical thinking alone, unless there seems to be any likelihood that these divergences threaten the execution of any important TOP SECRET 00298 8 �Document disclosed under the Access to Information Act Document divulgue en vertu de la Loi sur I'acces a I'information •SSRSSS SECRET Government policy or threaten to undermine the strict control of the Government over any of its agencies. 9. The policies of the Government toward the various nationalities in the Soviet Union show the same mixture of considerations. It seems that on the whole the Government would like to follow a reasonably liberal policy and not a "russifying" one. They would certainly like to be given credit for such an emphasis at any rate. The celebrations in March of the tercentenary of the Union of the Ukraine with Russia developed ad nauseam the theme of Ukrainian and Russian differences happily coexisting to the benefit of both nations within the framework of the socialist state. Even in some government actions, particularly the placing of Grimes, under the control of the republican government of the Ukraine, the Ukraine was treated generously. At the same time, In other areas (with smaller national groups) the Government has shown that, in the pursuance of its economic policies particularly, it will allow no considerations of regional feeling to stand in the way of a ruthless application of any policy decided in Moscow. If, as part of its agricultural policy, the Government wants to reorganize tractor stations, start using virgin land and in general start things moving quickly in any particular area, the managers and experts from Moscow move in and take over. Considerations important in the theory of relationships between the nationalities receive scant consideration. 10. The 1954 Soviet budget, announced"in April, provided for the largest capital investment programme in the history of the country. The total amount budgeted for capital investments is 184.9 billion roubles, a rise of nearly 19$ over the amount budgeted in 1953. The structure of these Investments shows the seriousness of the intention to carry into effect the new economic programme aecouneed in the Fall of 1953 which favours the consumer. For the first time, agriculture, light and food industries are receiving emphasis. 11. . Revealed defence expenditures are budgeted at 100.3 billion roubles, compared with 110.2 billion roubles budgeted for 1953. With due allowance for concealed items such as internal security forces and scientific research and development, It is believed that overall defence expenditures in 1954 have stabilized at about the 1953 level. There is no evidence of declining emphasis on the maintenance of a strong military establishment. 12. The report of plan fulfilment for the first six months of 1954 indicates that the economy of the Soviet Union is still expanding at the rate of seven or eight per cent a year. Industrial production rose by the rather surprising figure of 14 per cent over the first half of 1953, a greater rise than in 1952 or 1953. It is estimated that output of heavy industry (which represents about two-thirds of total industrial output) increased by about 12$ as compared with 18$ for light industry. There is every indication that the original Industrial production target of the. present, five-year plan will be over-fulfilled. Investment plans were not fulfilled In the first six months, the largest increases being achieved in agriculture and consumer goods. The metallurgical industry registered only a 3$ increase over the first six months as compared with a 14$ increase for total investment. 13« The greatest economic activity in recent months has undoubtedly been in agriculture. In February, a detailed and quit* realistic report on agriculture was made to the Central Committee, of- the Party by Khrushchev. This report underlined again the serious state of important parts of the_agricultural'sector of the economy and the TOP SECRET .4 00298 9 �Document discliDs^iypdei i e d i M d e r tthe he A Access to Information Act i C i f e r t u de la ILoi sur I'acces a I'information "»«SRKr * KW a TOP SECRET activity reported in the press since that time has been considerable. The Government has proclaimed Its intention to put large areas of virgin and idle lands into cultivation. It has amsOTneed plans for "more effective control of the Machine TractOr Stations on which collective agriculture depends. It has provided new incentives for the peasant's to produce. It is trying to put large numbers of specialists into the countryside to develop a more scientific agriculture. It has since the beginning of the year held conferences at all levels of various kinds of workers in agriculture in order to inform and inspire the people who will have to do the real work involved in increasing agriculture production. The Government has not committed itself so much to quantitative objectives as to the introduction of new methods in agriculture. Early in the year when production figures were published, however, the figures for grain production were more than normally vague and there is a strong suspicion that this is because they were particularly, embarrassing. 14° The consumer has received some increased benefits so far, but they are moderate enough. The price reductions in April of this year were not, either with respect to the number of items affected or with respect to the total monetary reduction involved, nearly as great as those of last year. For the first time since the various Five Tear plans began $. the production of consumer goods rose at a rate higher than that for industrial production as a whole. The consumer goods chiefly affected are, however, to a considerable extent, luxury goods and other products of light industry. Food and some other products of agriculture can be made available in greater quantity only at a much slower rate because of the serious basic problems in agriculture which must first be solved. Consumer benefits so far in the post Stalih era have been apparent more at the wealthier levels of the urban population and It will take some time for them to work down to poorer peoples particularly to the great agricultural masses who live at a level hardly above subsistence. 15* The 1954 Satellite budgets show the effects of the new economic policy. In all cases, the vote for defence expenditures is below that of 1953 and It appears that this item is likely to remain at or about the level achieved in 1953 except in Roumania where it is substantially reduced and is now more comparable with the proportion of the total budget allotted to this item by other Satellites. This trend is the same in all Satellites. The new economic policy introduced by the Soviet Union appears to have resulted in considerable difficulties, confusion and uncertainty in the Satellites which have been geared to forced industrial production. From announcements at the various party conferences held early this year, It appears that the plans of all Satellites (with the possible exception of Bulgaria) will be coordinated with that of the Soviet Union in 1956. Thus, Czechoslovakia which ended her first Five Year Plan in 1953 has instituted one year plans for 1954 and 1955 and Hungary which ends her Five Year Plan in 1954 will not commence her second Five Year Plan until 1956. The interval will apparently be utilized as a breathing spell In which to prepare the economies for further efforts during the period 1956-60. Armed Forces and Weapons Systems 16. Nuclear Weapons. It is clear that the Soviet Union is engaged in a high-priority, extensive atomic energy programme, and has already in existence a substantial stockpile of nuclear weapon^ in a range from the equivalent of a few thousand to at least a million tons of TNT. We caimot estimate with any certainty precisely how the Soviet Union vdll use its available stockpile of fissionable material, but the following is one example of the use which might be TOP SECRET 00299 0 �i Document disclosed under the Access to Information Act - ' Document divulgue en v e r t u j e la Loi sur I'acces a I'information POP SECRET made. (These figures may be in actual fact as much as one third higher or lower). j Boosted uranium or plutonium weapons 1000 KT 60 KT 5 KT Mid Mid 1954 mi 18 85 250 34 125 375 17. The Army. No major changes in the strength and organization of the Soviet ground forces have been observed during the last six months, and the army continues to consist of about 3j000,000 men organized into about 175 divisions. The pattern of training of the Soviet troops stationed in Germany deviated somewhat from that of previous years, and ^towards the end of the summer the training programme was slightly behind normal. Of particular interest in the Soviet training programme of the current year has been the attention devoted to atomic warfarej this is now known to have included both offensive and defensive training and to have led to a departure from the traditional Russian concept of the massed employment of ground forces in favour of increased mobility and more rapid deployment. j 18. During the course of the year, new personal weapons as well as new artillery pieces appeared in Germany and the existence of a new heavy and a new medium tank continued to be reported, although neither of these tanks has been seen as yet. Late in the summer, the existence of large numbers of new armoured personnel carriers was confirmed, improvements also continue to be reported in bridging equipment and in the number and quality of amphibious vehicles. 19. The strength of the European Satellite Armies has continued to fall during the last six months. The estimated total strength is now 978,000 compared with approximately 1,000,000 on 1 Mar 54•" At the same time the total ntniber of divisions, approximately 75, has not altered and the strength decrease would seem to indicate the growing effect of the continued reorganization of units along Soviet lines. There is evidence that the 1954 training programme is more comprehensive than that attempted in 1953, although it remains to be seen whether a higher standard of training will be achieved. A most interesting sidelight on Satellite affairs of the last six months is that all the Satellite countries now have Soviet MAs who are heroes of the Soviet Union, at least lieutenant-generals in rank and outstanding wartime commanders. It seems possible that this results from a deliberate policy to have on the spot Soviet officers qualified to assume control, at least covertly, of the armed forces of the country concerned in the event of an emergency, j 20. The Navy. The post»war expansion of the Soviet Navy has continued during the period under review. Although the Sverdlov construction programme seems to be drawing to a close, there can be no doubt that the present submarine building programme is an extensive one; the estimated rate of production of "Z" and "Ww TOP SECRET ....od 0Q299 �Document disclosed under the Access to Information Act J l l,wt ' i i m j i l " de la Loi sur I'acces a I'information Document iliiiuli ilniiil jit j 5 l ft S i ^ " ^ Class Submarines is 50 in 1954, rising to 75 in subsequent years, the Skory class destroyer programme has been completed (a total of 72 ships of this class is now in service) and a new class of destroyer is being introduced into service with an estimated production rate of 12 per year. 21. A programme to re-equip Soviet ships with improved armament is continuing and there is evidence that they are developing a close cycle HTP torpedo. In addition, Soviet naval communications have been considerably improved by re-equipment of ships, aircraft and shore stations with U.H.F. equipment. 22. Exercise activity in all fleet areas seems to be going on at a higher rate than in previous years. There are indications that this year the training is more intensive and of a more advanced nature than during the same period of 1953* Fleet exercises have taken place in the South Baltic, the Northern Fleet area and on a major scale In the Black Sea. A notable feature of the training activity in all fleet areas has been the considerable co-operation of naval aircraft with the surface forces. 23* It has become apparent, particularly in the past six months, that we have to some extent underestimated the Soviet Union's capability to match our standards in efficiency and their ability to produce modern ship-borne electronic equipment. They have now reached a high standard in efficiency and possess fully modern ships and weapons. 24. The Air Foroe. The Soviet air force continues to consist of about 20,000 aircraft including about 10,000 fighters, 3,000 light bombers, 1,000 medium bombers, and ground attack, transport and reconnaissance types. The most important intelligence developments during the period were the sighting ln flight of one four engined jet bomber (Type 37) and 9 twin engined jet bombers (Type 39) and good indications of the re-equipment of at least one Long Range Air Force regiment with the Typ© 39. The Long Range Air Force is now believed to be equipped with about 1,000 TU4 medium bombers and possibly 50 Type 39 medium jet bombers and to be in early stages of re-equipment with the Type 39. Current range estimates for this latter aircraft vary from J9000 NM to 4,200 NM. Conversion of all fighter and light bomber units to jet- aircraft is almost complete and should be completed by the end of 1954* In addition^ about one-third of the fighter regiments are believed to have progressed from the MIG15 to the MIG17. It is also of interest that 3 regiments of IL28 aircraft have returned after one year's absence to the Russian zone of Germany. Since this move took place last May, it is apparently permanent. 25,*', ; During the past six months, the European Satellite Aircraft strengths changed only slightly. Themost-noticeable change occiiired in the Polish aix order of battle where there was an inci'ease in the strength of ground attack aircraft. The combined operational strength of Bulgaria, Czechoslovakia, Hungary, Poland and Roumania is approximately 2,200 aircraft, a little more than a third o f which are jets. 26. Early warning and radar defences in the Soviet Union and Satellites continue to improve, although the present equipment is considered to be somewhat inferior to Western equipment with respect to height finding and fixing. There is evidence to indicate that attempts have been made to integrate operational control of Satellite fighter aircraft, particularly in Poland and Czechoslovakia. TOP SECRET 00299 2 �the Access to Information Act Document disclosecLunder disclosedii ntrertu de la Loi sur I acces a I in Docume D TOP SECRET 27. It Is believed that as a result of the widespread airfield development and reconstruction"programme, which has been underway throughout the Gommunist bloc since 1948, the Soviet Air Forces are now adequately equipped with major air bases in all areas of probably operations (European Satellites, NOrth European Soviet Union facing Scandinavia, Black Sea ahd Caucasus regions and the Far Eastern Maritime Military District). 28. Aircraft Production. The Type 37 (of whieh only one aircraft has been observed in flight) Is estimated to have an all up weight of 375,000 lbs with speed and height over target of 452 kts and 47,000 ft respectively. Estimated radius of action is 3,200 nm. Production models should appear about mid 1955* The Type 39 swept wing medium jet bomber is estimated to have a speed and height over target of 460 kts at 44,000 ft. Radius of action estimates vary from 1,500 to 2,000 nm. It is expected i,hat 70 will be In operational units by the end of this year and 500 by mid 1958. These two aircraft are believed to be equipped with engines having 16,000 lb static thrust at least. 29. There is still no evidence of production of an allweather fighter. However, on a requirement basis, it is estimated that one will appear before mid 1955* On the basis of engine development mentioned above, a supersonic fighter could appear by 1956. 30. The Type 31 turbo prop bomber appears to have been dropped, although the possibility of its appearance as a transport or tanker cannot be entirely dismissed. There is some evidence of production of a new transport, but its characteristics are unknown. 31. Helicopters capable of carrying light field guns and small vehicles are in production and are still being. Introduced into the Air Force of the airborne forces. 32. Guided, Missiles» During the past six months, evidence has accumulated which strongly indicates that the Soviet Union has already begun production of some types of guided missiles, as follows s (a) A surface-to-surface missile having a range of approximately 900 kms (565 nm) and capable of carrying a nuclear warhead. (b) A surface-to-air missile having a range of approximately 30 kms and capable of a l t e r nat&Mr eanploymenrfc.in a surface=to-surface role . (c) An air-to-surface missile having a range of approximately 30 nautical miles. 33. It appears most likely that Russia does not now possess an intercontinental guided missile and it,is improbable that a true ballistic type missile of the requisite range will be in service use much before I960. An intercontinental missile of the aircraft type might, however, be available by 1957. Apart from the intercontinental missile and the long range (100 nm) air-to-surface missile, there is no reason why Russia could not have all other major types of missiles In service use by the end of 1955, at least In limited numbers. 34 " 36. Not used. TOP SECRET /8 �Docume DT9 under the Access to Information Act vertu de la Loi sur I'acces a I'information SECRET Soviet ForeTgirYoliey and Developments in Troubled Areas of the World " 37. In the past six months the Soviet leaders have maintained their intransigent stand on disarmament and the problem of atomic energy control. Gommunist control has been strengthened in East Germany and measures pursued which enhance the role the Soviet Zone seems destined to play in future Soviet policy in Germany. There has been no diminution in Soviet opposition to NATO and EDC and new steps have been taken to promote Molotov's version of a suitable European security organization. At the same time through diplomacy, propaganda and trade policies the Soviet leaders have attempted to weaken NATO, to divide the West, and in particular to arouse hostility and opposition to the establishment of U.S. bases and to U.S. policies in Europe, the Middle East and other areas of the world. The Soviet leaders appear to feel that international conferences conducted outside the jurisdiction of the United Nations offer a useful means of pursuing these objectives although also underlying their attitude to such negotiations there is probably a strong desire to eliminate the risks of war associated with dangerous trouble spots like Korea and Indochina. They have not shown so far that they consider it necessary to make concessions of any substance to the West or to compromise at all on matters which they apparently consider to be essential to the safeguarding and consolidation of Communist gains in Europe and the Far East. Advocacy of an expansion of East-West trade has been continued in the period for internal economic reasons as well as general political considerations. This policy, together with an international cultural offensive, an energetic flirtation with the United Kindgom and Francesapplications for membership in 110 and other international bodies,and in general its attitude towards negotiations, has also been designed to support further vigorous prosecution of the theme of "peaceful coexistence" and to give it in Western eyes added feasibility and attraction. The Soviet position on these various matters is examined in more detail. under the appropriate headings below. Atomic Energy Control and Disarmament 38. At the end of April the Soviet Union categorically rejected President Eisenhower's "Atomic Pool" proposals. Later at the London talks on disarmament in June the Soviet representative refused to discuss the problem of international control In any detail before "a decision'* was taken on the principles of a disarmament programme, especially the principle of prohibition df atomic weapons. The anxiety aroused in.many countries over the result^ of the U.S. H=Bomb explosion in the Pacific last March enabled the Soviet Union to turn its stand to propaganda advantage. Although ht London the West made a number of concessions to the Soviet position the Soviet government apparently was unwilling or felt it to be unneeeksary at this stage to deviate from the views it has so far adhered to. 39. -In East Germany the Communist grip on the Zone has been improved by the regrouping of Soviet forces, reorganization and expansion of the armed fighting groups of the SED (the Kampfgruppen), the strengthening of the Volkspolizei and the achievement of some amelioration in the food situation. In March the Pankow regime was accorded formal sovereignty by the Soviet Union and the Deputy Premier subsequently cited the recognition achieved by the Communist regimes of China, Korea and Vietnam at the , y Geneva Conference as a hopeful angary for the East German regime. In' ;;. Implementation of the spirit of Molotov's proposals on All-German committees at the Berlin Conference Communist propaganda in the Soviet TOP SECBET ...../9 00299 4 �Document disclosed under the Access to Information Act Document divulgue en vertiLitaJyi.o/sur I'acces a I'information • S S B S S L Zone urged more cpntacts between East and West Germans and the Soviet Zone government in the period has facilitated visits of its officials, sports teams, artists and orchestras to West Germany. In the latter zone the public statements of prominent Conservative Statesmen like Bruening and Luther, a development of opinion in favour of making contacts with the Soviet government, and the increasing interest of West German business firms in Soviet bloc trade seemed to offer these Communist tactics seme hope of success. The purposes which this policy was intended to serve were illustrated in the proceedings of a National Front Congress convoked in East Berlin in May and in a referendum conducted in the East Zone in June. The referendum offered Germans a choice between a peace treaty and the withdrawal of occupation troops or the EDC and Bonn Treaties with occupation troops remaining for fifty years. Taken In conjunction with the Soviet notes of March 31, July 24 and August 4 these developments seem to show that tbe Soviet Union has no intention of changing its position oh Germany and that it is more intent than every on bringing about a solution conforming to Soviet requirements. 40. The Soviet determination, revealed at the Berlin Conference, to subordinate an Austrian settlement to the German one inevitably was bitterly resented by the Austrians and there has been an increase in friction between the Soviet occupying authorities and the local authorities. The Soviet side have sought to demonstrate to the Austrians that any change in the present situation is impossible, and Soviet propaganda dwelling on fears of a revival of Anschluss - has not only survived the Berlin Conference but " has been intensified as a convenient means of justifying the retention of occupying forces. Apart from the more important reasons for their position the Khokhlov defection and the removal of the World Peace Gouncil Secretariat to Vienna from Prague In April indicate that the facilities obtained in Austria for Soviet propaganda and espionage organizations reinforce the desirability of continued occupation of the country. 41. In spite of a proposal in April to join NATO the Soviet Union remained fundamentally antagonistic to NATO and EDC and both in its propaganda and, In the three diplomatic Notes referred to above, continued to press for the Soviet version of a European Security Organization which Molotov had urged at the Berlin Conference. The failure of the French Assembly to ratify EDC at the end of August can be explained as primarily the consequence of French reluctance_sto accept the kind of association it sanctioned with Germany. But the process was probably assisted by Soviet diplomacy, which by its well-timed proposals for a further four power conference on Germany ensured that the defence of EDC in France was at best a half-hearted one. 42. In March the Soviet Union, continuing its campaign against American bases in Europe, sent protest Notes to Turkey, Greece and the Netherlands. The Scandinavian countries also received attentions a warning against the stationing of foreign troops on Danish soil was delivered to Denmark and efforts were made to arouse hostility in' Iceland to U.S. bases. Finland was made aware that the Soviet Union did not appreciate the Finnish desire to establish closer relations with its Scandinavian neighbours. Economic considerations, notably a surplus rouble balance and the increasing importance of U.K. trade, may have stimulated Soviet apprehensions. As a corrective the Soviet Union sought in economic negotiations with the Finns an expansion of trade which for the first, time included Soviet fighter aircraft. By these various steps in Scandinavia the Soviet Union was obviously persisting with some success in its policy of preserving the status quo in Scandinavia, to encourage military weakness and neutralism in the area and as a consequence to weaken NATO. TOP SECRET i n . II _____• i ....../10 * O O O O * / i . W 00299 5 �Document disclosed under the Access to Information Document divulgue en vertudfetnto/ sur I'acces a ^S^Sfe Act - I'information •ft TOP SECRET 43. A cautious approach was discernible in Soviet tactics In southeast Europe. Easier relations between the Soviet bloc and Greece and Yugoslavia were "the ostensible aim of an agreement to resume Greek-Bulgarian relations in May, the relaxation of restrictions on the return of Greek children to their homeland, the conclusion of a barter deal between Hungary and Yugoslavia and the projected re-establishment of rail traffic between the latter country and Roumania. These developments did not affect the conclusion of the Balkan Military Alliance but were probably conceived as part of a strategy designed to render the Alliance ineffective eventually by lulling the fears which had led to its formation. The Middle East 44. In the Middle East region Soviet leaders appeared to be primarily interested in impeding the organization of ah effective defence system and to this ehd their activities have sought to keep conditions as unsettled as possible. Although, in deference to local susceptibilities, they have warily avoided direct interference, they were also concerned to insure themselves against future developments favourable to the West. Thus they have sought to develop their relations with, and to improve Soviet influence in, some Middle East countries. A-5* Following the conclusion of the Turkish-Pakistan Alliance the Soviet Union sent protest Notes to both countries in March* Soviet propaganda has played on Israeli fears of the implications of the Alliance and also of U.S. military aid to Iraq. Radio propaganda to Egypt has sought along the customary lines to exploit local xenophobia against the United Kingdom and the West. In the United Nations the Soviet veto in the Security Council on the Jordan Water's dispute and Israel's complaints against Egypt hampered the United Nations in its ability to deal with new grave incidents on the Israeli borders in May and June. 46. Through direct diplomatic efforts the Soviet Union has concluded with Afghanistan in the period further technical assistance agreements which include a provision for the stationing of an additional number of Soviet technicians in this country. The Soviet Government is also apparently attempting to reach a settlement of its frontier and financial problems with Persia. In the same period the achievement of a solution to the oil dispute between Persia and the United Kingdom and an agreement on the Suez base between the United Kingdom and Egypt revealed that there were limitations to the success the Soviet Union could expect fromiheir present tactics. Central America 47. The deterioration in Guatemala's relations with Nicaragua, and increasing U.S. anxiety over the trend of developments in the former country, reflected in the passage of an anti-Communist resolution at the March Conference of the O.A^S. in Caracas, presented the Soviet Union with an opportunity of dubious value for fishing in troubled waters in this area. Arms shipments to Guatamela in May from the satellite countries may have been intended to strengthen the position of the Communistinfiltrated Government. In the event, however, the alarm aroused in the Americas encouraged opposition Guatemalan elements operating from Nicaragua to precipitate in June a revolt which proved successful. Soviet efforts to secure action from the U.N. Security Council in response to a request from the Guatamelan regime were blocked by a U.S. counter-move in favour of consideration of the problem by the O.A.S. The Soviet delegate in return sought to derive the maximum propaganda advantage in a sense derogatory to the prestige of the United Nations and those of its members who had supported the U.S. position. TOP SECRET ....../ll 00299 6 �Document disclosed under the Access to Information Act h/ ,. cDj&ument divulgue en vertu de la Loi sur I'acces a I'information %7^%m^\^l . i_&p SECRET o The Far East 48. Korea. In the Neutral Nations Advisory Commission, Swiss ahd Swedish reports indicated the clear intention of the Communists to render the operations of the Commission in North Korea as ineffective as possible. Their philosophical acceptance of the outcome of the Geneva Conference, which confirmed the present stalemate, suggested, in lieu of any other evidence to the contrary, that they were content to see a continuation of the present armistice arrangement until there was a prospect of attaining a settlement conforming to their requirements. At the Conference their position was notable for its insistence oi£ the immediate withdrawal of all foreign troops and its denial of the moral authority and status of the United Nations in the issue. They sought to probe divided counsels oh the U.N. side and derived some satisfaction at the concluding sessions when the U.S. representative, to the embarrassment of some of his other U.N. colleagues, was not in a position to discuss a proposed declaration of good intentions. 49. Indochina. Although the military situation in Indochina was on the whole favourable to the Vietminh forces the Soviet position, which seems to have been fully shared by their Gommunist Chinese partners, clearly indicated their desire to reach a negotiated settlement. In the closing stages of the Conference the Communists retreated from an earlier position which had involved French recognition of a partition line at the 14th parallel in Vietnam and substantial Communist regroupment areas in Laos and Cambodia. Both the Soviet Union and Communist China were probably anxious to prevent the Indochina war from developing into a more dangerous source of conflict between East and West. However they probably also entertained the hope, which the outcome seems to justify, that a settlement, unlike Korea, would allow Communist sxpansioh over all of Vietnam to be attained by peaceful means and that their willingness to come to an agreement could be employed to create confusion and division in the West and reinforce the credibility of propaganda about the peaceful Intentions of the Soviet Unionj 1 50. There was no evidence in the period to suggest any real divergence of opinion between the Soviet Union and Communist China oh Communist overall strategy and tactics in the East. A few minor Incidents occurring during the period of the Geneva Conference indicated that the Soviet and Chinese positions might not be fully coordinated in detail and they encouraged speculation on the possibility of an independent Chinese approach to the problems at issue. The willingness of some South-East Asian statesmen like Nehru to be impressed by this possibility undoubtedly facilitated approaches by Ghou .eft-fcsf to India and Burma which were obviously designed to keep these two countries aloof from Western endeavours to develop a strong South-East Asian Defence Organization. These activities of the Communist Chinese foreign minister, his close relationship with the Vietminh leaders, along with evidence that the Soviet Union is importing rubber from South-East Asian countries through China suggest, as an alternative explanation of the present relationship between the two Comraunist powers, that the Soviet Union is content to rely on its partner's initiative in the consolidation and expansion of Communist influence in Asia. East-West Trade 51. Soviet propaganda for "normal trade relations" with non-communist countries and a number of large offers for strategic or semi-strategic goods have been responsible for a relaxation of international controls on strategic exports to the Soviet bloc. During this period, the largest orders continued to be for merchant and fishing vessels, Japan now being TOP SECRET /12 00299 7 �Document disclosed under the Access to Information Act - Document divulgue e j ! M l ^ la Loi sur I'acces a I'information 10 wwSSSfkSw ^ Sfck""T0P SECRET included among the list of suppliers. In the past six months, the East European satellites and China have also begun to expand their trade with the West, though more than three-quarters of their trade remains with the bloc. The proportion is still higher for the Soviet Union. Technical assistance extended to Afghanistan and a dollar loan to Finland have been the two most interesting new developments in the economic cold war, apart from the relaxation of western export controls. A3 TOP SECRET 00299 8 �disclosed_unj^JtjflAress fo Information Act Document disclosed underlj; a\oi sur I'acces a I'information TOP SECRET ' fcSfmftBADIAN EYES ONLY The International Communist Movement and the Mass Organizations 52. During the1 period under review the Communist parties outside the Soviet orbit continued to play their traditional roles of auxiliaries - in the army of which the USSR was the main force. Communist tactics,as well as propaganda, continued to be opportunistic, variable and readily adaptable to local circumstances - in accordance"with the doctrine of "zig-zag manoeuvring" basic to Harxist-Lenninist ideology. The mass organizations the W.F.T.U.t WPC, WFDY and the others - again proved to be useful media for propaganda,'as well as providing the necessary machinery for continuous contact between party specialists working in particular fields - e.g. labour secretaries, youth organizers, women's and veterans' specialists. On the whole, the*mass organizations were less successful than in previous years in attracting celebrities not clearly identified as party members or fellowtravellers - an'Indication of the greater degree of public awareness in the West of the true 'function of these organizations. It is also perhaps signi"<ficant that the WFTU now appears to have definitely replaced the WPC as the main vehicle of propaganda designed to divide the West. We have no evidence that the relative decline in the WPC vis-a-vis the WFTU is a matter of concern to the architects.of international Gommunist policy in Moscow. On the contrary such a development ties in very closely with the great emphasis which has been given this year to the need for improved organization and for broadening the base of the United National Front tactic. 53. Many parties have experienced fairly drastic organizational shake-ups particularly in Europe and in Latin America - and it is apparent that the new leaders in the Soviet Union are determined to overhaul the organizational, incompetence which marked so many parties (particularly the Latin American ones) in the last years'of the STALIN regime. Along with the emphasis on organization there has been.a greater concentration on the training of cadres, particularly in the labour field. A system of training schools has now been organized under the WFTU and they are believed to be located in Hungary.. To them are being sent large numbers of young Communists from under-developed areas (particularly the Middle West and Latin America) for intensive training in labour agitation and, incidentally, in patty discipline. By this method it is hoped that the parties in these areas will haVe a well-trained core of young militants who will greatly improve both the parties' organization and their exploitation of labour unrest in the areas concerned. 54. The "United National Front" tactic remains the basis of the propaganda drive of international communism throughout the world and the basic propaganda continues to be peace, the rights of nations to self-determination, the rights of workers to "democratic liberties" and the rights of colonial and dependent peoples. A feature of the past six months appears to have been a broadening in the base of the "United National Front" campaign. The success of the Italian Communists - by far the post powerful party outside the Iron Curtain in broadening the appeal of this propaganda theme has undoubtedly had some influence on the party as a whole. Now the emphasis is on greater flexibility and less "sectarianism" in promoting "unity at the hase" - i.e. by the persistent courting both of non-Communist unions and of individual non-Communist and intellectual workers. Moreover, this period has also been marked by a considerable, diminution in the abuse previously aimed at non-Communist labour leaders. By these more flexible tactics it is hoped to expand popular support for common action, both in the economic and political spheres, against "American imperialism" and its "lackeys". This broadening of the line has not been carried out without resistance from the more orthodox and "Marxist" party workers. The dismissal last February of Le Coeur, the organizational secretary of the French Communist Party, is a case in point and his dismissal, as well as that of other doctrinaires in various parties throughout the world, is evidence that "sectarianism" will no longer be tolerated. 55. The exceedingly important defection of Petrov in Australia and the somewhat less important defection of Khokhlov in Germany certainly represent major setbacks to the party during this period. While these defections are clearly of the foremost importance from an intelligence standpoint they were somewhat offset - from the viewpoint of propaganda - by the recent defection of Otto John from West Germany. TOP SECRET ... ./IA. 00299 9 �Document disclqsexj^uHder the Access to Information Act nent disclqseij^UHde D ( ^ M n t A | u K n D l r t / * t u de la Loi sur I'acces a I'information • " S R B B TOP SECRET CANADIAN EIES ONLY 56. As far as the party in Canada is particularly concerned, significant developments appear to have been these: (a) the Labor-Progressive Party has apparently made an estimated gain in numerical strength of approximately 6%, primarily in the Province of Quebec, in spite of the anti-communist legislation in effect in that province; (b) there is evidence to indicate that the Canadian communist . movement may assume leadership in the western hemisphere, generally against "American imperialism", and particularly with reference to recent and current political events in Guatemala, which indicate possible participation in forceful action against the government of that country; ( \ (c) there has been a considerable increase in the number of Canadian contacts made by Soviet diplomatic personnel, not all of which have been confined to known members or organizations of the communist movement, with the consequent possibility that espibnAge agents are being recruited outside of the movement In'CahadaV v 57. International Co-ordination of the Party Recent information from U.S. sources has given us a much better picture of the present apparatus used by the Soviet leaders for ensuring international control of the party'in" the maimer achieved by the Comintern prior to its dissolution in 1943. The present agency now employed Is the Foreign Section of the Central Committee of the CPSU, which has become a very important body indeed, it is the function of this section to provide the link between the CPSU and the individual CP's abroad, to receive information from them and to transmit directives to them for agitation, propaganda and organization. The Foreign Section is also the agency primarily concerned with manipulating the international "mass, organizations" and the Soviet representatives at the various conferences of these bodies are either members of the Foreign Section or else they take their directives from the section. At the same time, this section has responsibility for controlling the ideological line of the Cominform Journal "For a Lasting Peace, Fpr a People's Democracy". We have only scanty information on the personalities of this section but one of its chiefs is believed to be Mikhail Suslov, a leading party theoretician, who is also thought to be a Secretary of the Central Committee of the CPSU. In its operations abroad, the Foreign Section provides the contact with liaison officers of the local CP's. The latter are highly trusted functionaries of the local party whose selection must be approved by the Central Comniittee of the CPSU itself. The representatives of the Foreign Section are sent to the various Soviet missions abroad under diplomatic, commercial or TASS cover. Sometimes their functions are combined with those of the "legal resident" of State Security (e.g. Petrov) in the same man. Sometimes there are two individuals in the same mission performing these two functions. Sometimes, again, there is no permanent representative of the Foreign Section at a mission but the function is carried out by means of "flying visits" from Moscow by a member of the Section. Their contacts with the local "liaison officers" are usually direct and they avoid using intermediaries wherever possible. The liaison officer's job is to receive the directives for agitation and for organization, to receive the secret funds (if any) and to transmit back any information gathered by the local party, 58, The Russian Intelligence Espionage Services On MaJteh 13 of this year an important reorganization took place in the Soviet State Security apparatus. The functions of State Security and Internal Affairs which had been brought together in one department a year previously were again separated. Under the new set-up the KGB (Committee of TOP SECRET /15 00300 0 �t 1/ Document disclosed untaf the Access to Information Act Dpcumimt dj^||J*^MjW[»rl* de la Loi sur I'acces a /'information ||£_Ufl0> r* CANADIAN EYES ONLY State Security) assumed responsibility for counter-subversion (the enormous network of informers within the Soviet Union itself), "counterintelligence" (in our words, counter espionage) and positive espionage abroad. Remaining with the MVD (External Affairs) itself were such functions as the uniformed police, the border troops, and the administration of slave labour camps. The Impression gained is that the primary reason for this new reorganization was the determination of the chief party leaders to prevent a new concentration of security power which might lead to the emergence of another Beria. 59. Despite the frequent reorganizations which have occurred in the super-structure of Soviet State Security during the past twenty years, the internal organization of the espionage directorate (KGB) itself has remained fairly stable. Traditionally it has been referred to as INU (for Inostrannoye Upravleniye - or "foreign directorate"). The various sections of INU are organized on a geographic basis and additionally there are sections for operations against Russian emigre'groups throughout the world, for controlling the activities of the satellite espionage organizations,and for dealing with liquidation and sabotage activities. 60. The defector Khokhlov1s evidence indicated that the Soviet State Security authorities are now committed to a campaign of selective sabotage and terroristic activities even in peacetime - either through permanent agents of this section of the INU stationed abroad, or by assigning work'to special agents' oh a"Contract" basis. Another important function of this section is the preparation of "stay-behind" nets of agents to function in the event of war. Soviet State Security nets abroad may be headed by a "legal resident" (e.g. Petrov), who is in the country concerned under diplomatic or commercial cover. In addition to these nets headed by "legal residents" are the "deep cover" nets headed by agents illegally in the country concerned. The activities of these latter nets proceed independently of the "legal resident" and they report quite separately to INU headquarters in Moscow, although they may occasionally get "logistic support" from the legal resident. We understand that the Soviet Security Chiefs now prefer to use Soviet nationals as agents wherever possible and it is estimated that, even in the "deep cover" nets, a large number of the agents are Soviet citizens, some of whom may have lived in the country concerned for many years before becoming active as an agent. For security reasons known Communist party members abroad are now apparently only recruited as agents as a last resort. On the other hand, fellowtravellers are highly regarded as potential recruits, if their ideological sympathies are not too widely known. The liaison officers of the local C.P.'s often operate as "talent-spotters" for potential agents. The cultivation of such po tential agents is, however, the task of the legal resident. 61. Parallel to the INU is the second Soviet espionage agency - the RU, or Armed Forces Intelligence Directorate. Its primary targets are, of course, military and technical intelligence, but there are a number of areas in which it may obviously overlap or duplicate the functions of the INU. The existence of two separate networks is however'regarded as a source of strength.'; At present, many observers consider that morale in the RU is somewhat higher than that of the INU, and the defections of Petrov and Khokhlov from the latter agency would appear to support this view. However, it is considered that both agencies are quite capable of sending first-rate operators to their primary espionage targets. Our information is that probably the most able men of both agencies are stationed at headquarters in Moscow and that the next best ones are probably stationed in the United States and the United Kingdom. TOP SECRET 00300 1 � Dublin Core The Dublin Core metadata element set is common to all Omeka records, including items, files, and collections. For more information see, http://dublincore.org/documents/dces/. Identifier An unambiguous reference to the resource within a given context CDDF00029 Title A name given to the resource Semi-Annual Review of Intelligence (February - August 1954), JIC 116 (54). Date A point or period of time associated with an event in the lifecycle of the resource 14-Sep-54 Source A related resource from which the described resource is derived Library and Archives Canada, Record Group 25, vol. 7902, file: 50028-B-40, pt. 3. Creator An entity primarily responsible for making the resource Government of Canada Rights Information about rights held in and over the resource Canadian Crown Subject The topic of the resource Cold War Defectors Description An account of the resource Canadian Foreign Intelligence History Project Publisher An entity responsible for making the resource available Canada Declassified Type The nature or genre of the resource Text Format The file format, physical medium, or dimensions of the resource PDF Language A language of the resource en