THE OUTLOOK FOR NORTH VIETNAM INTERNAL POLITICS AND POLITICAL PROBLEMS ECONOMI

Created: 3/4/1964

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The Outlook for North Vietnam

SPECIAL

NATIONAL INTELLIGENCE ESTIMATE

The Outlook for North Vietnam

Tirnpf

TABLE OF CONTENTS

PROBLEM

NOTE

CONCLUSIONS

DISCUSSION

I. INTRODUCTION

!I INTERNAL POLITICS AND POLITICAL PROBLEMS

ECONOMIC PROBLEMS AND PROSPECTS

MILITARY PROBLEMS AND PROSPECTS

V. THE SUPPORT OP INSURGENCY

VI. THE OUTLOOK FOR NORTH VIETNAMESE POLICIES

2

THE OUTLOOK FOR NORTH VIETNAM

THE PROBLEM

To assess the strengths and weaknesses of North Vietnam (DRV) and to estimate its probable courses of action over the next several months

NOTE

Firm mformation about North Vietnam Is extremely sparse Accordingly, analysis of the economic and political situation and especially ol the size, structure, and capabilities of the armed forces, is extremely difficult, and the judgments below must be considered tentative.

CONCLUSIONS

believe that the North Vietnamese leaders look atprospects with considerable confidence In Souththey probably feel that GVN will to resist Ismay feel that the same Is true of the US. They mayspeed the processtep-up In current Viet Congpressure and terror We think Hanoi will stop short ofsizable DRV military units into South Vietnam,bringajor US military retaliation. In Laos,protect the positions they have already achievedPathet Lao efforts to erode the non-Communistwill seek to avoid initiatives that would provoke US )

Vietnam's external successes have beenimportant internal problems and vulnerabilitiesfaces severe and chronic food shortages andamong the populace and even the lower ranks of the

Party. Tin? economy is overcommitted to developing heavyat the erpense of agriculture and heavily dependent on Bloc aid. The personal dominance of Ho Chi Mlnh maskswithin the leadership which will be sharpened after his death

problems and Tulnerabilitlea do not threatencontrol at home or materially hamper its presenteffort against South Vietnam and Laos, nor do theysomewhat higher level of such effort. However, the DRVcould not sustain large-scale military involvement, suchmvaslon.onsiderable Increase in Chineseor Soviet aid. )

o-Soviet splitainful dilemma to Powerful motives impel it to avoid taking sides defln-

atively, but events have moved the DRV progressively closer to the Chinese position We believe that Hanoi willry to maintain as cordial relations with Moscow as circumstances permit )

DISCUSS rON

ndch have characterized theefforts of the "Damx.aUc Republic of Vietnam" (DRV) tnand Laos an WtQ kPOwn, as are the situations in thosewhich Invite Communist exploitation But the recent newssuccesses tends to obscure the (act that the DRVariety of weaknesses.

Al POLITICS AND POUTICA1PROBLEMS

popular enthusiasm with which the DRV regime wasIts victory over the French4 has long since waned.accession to power, the Lao Dong (Communist) Party haa"build socialism"runcated, predominantly agriculturaldoctrinaire and. in earlier years. Draconian measures. Inwaa active revolt against certain "land reform" programsthe peasantry has shown considerable ingenuity inregime's agricultural policies. The regime has taken harshagainst intellectuals, Catholics (who make up about fivethend many ethnic minorities. At times, thesehave been tempered and some efforts made to win over thesethey remain for the mostima tad If economicsubstantially worsen, and particularly if tbe shortage ofreach wide-scale famine proportionsesult of athere might be localut they almostcould be contained Though the Ha-in regime appears toenough control over North Vietnam'sillion Inhabitantsthe outbreak of any serious dissldence, the populace seemsapathetic lo what the Party considers the needs of the stale.

3 This apathy even extends into tbe Party Itself, at least to the tower cadres, who have lost much of their revolutionary etan. I'ource of considerable doctrinal embarrassment to its leadership that Party membership (about three percent of the population) isurban and intellectual. The stability and cohesion which this leadership has displayed over pasteceptive, since it derives almost entirely from the prestige and skill of oneChi Minh. Honique figure in the world Communist movement, truly the last of the old Bolsheviks. Tbe Indochineac Communist movement was virtually ts personal creation, it has prospered under bis direction but. significantly, faltered and split whenever be bad to turn his primary attention to other matters.

o land apparently has not designated an hetr apparent. Hisenior subordinates who comprise the rest o( the Politburo areIn 'ongstandlng personal rivalries and aharp policy oUsagree-ments tohe question of Cbtneae Influence has been an Important element. The 1p'>Chlnesc" group, advocating generally militant policies. is centered around former Secretary General Truong Chlnh, who himself wat forced to resign that position6 because of his excessive zeal in pushing land reform on the Chinese model. Defense Minister Vo Nguyen Olaptrongly an tl-Chinese bias and has long attempted to resast Chlnh's encroachment into the military esttb-ii'hir.tr.t. over which Olap seems to have maintained at least nominal control Another grouping appears around First Secretary Le Duan, upon whom Ho seems to lean heavily In Party affairs, but Its political ortenlaUon is leas easily identified

has successfully kept these rival groups under control, but when be lea res the scene these rivalries arecretain to create serious difficulties within the Party and perhaps Instability within the country. Power within the Party probably will be decisive, although Olap may well seek to use his position in the military to affect tbe outcome The Chinese and Soviets will also try to exercise influence. At thla Juncture, First Secretary I* Duan appears most likely to succeed in view of his position and the fact that he probably is least objectionable to the various contending factions, but the succession is unlikely to be smooth, and might be violent.

til. ECONOMIC PlfOaifMS AND PROSPECTS

Structure of the Ecorumu North Vietnam is an essentially ruralk-vesopediicb does not produce enough even to teed Its rapidly expandingorth Vietnamood-deficit area throughout the period of French control, but its deficits then were easily offset by the transfer of surplus rice from theolution not now available The country has many natural resources, some of which were partially developed by the French. The present regime also Inherited from theudimentary transportation networkodest industrial plant. North Vietnam's industrial progress is inhibited, however, by small domestic capitalevere shortage of indigenous sallied labor and technical talent, and limited experience In management These problems are compoundedoctrinaire leadership, which la prone to pursue symbolic andsatisfying industrial goals conceived with Utile practicalto North Vietnam's domestic resources and economic need*

' Hanoi basopulation growth ofercent per annum bat this ntare eaaj be somewhat high

7 AjrtcultM--The Potential Food Crisis. Agriculturalfour years of poorack of fertilizers and Insecticides,rowing population have led to food shortages in Worth Vietnam. Thepparently bleaker than It has been for the past five vears; Hanoi itself says that the total3 output of food amounted to leas than five million metric tornf which over one-fifth consisted of unpopular secondary food crops (corn, yams, and3 food output in per capita term* was close to that7 (the lowest year since the regime came to power) but without the reservesreceding bumper crop5 per capita output of nee. the preferred cereal, was about one-fifth

B^The regime is apparently endeavoring to Import foodstuffs. It seems to be acquiring only small amounts from non-Bloc sources, and there are some Indications that Hanoi may be having difficulty finding forma of payment satisfactory to foreign exporters, We do not know how much food may be arriving currently from the Bloc, but believe that China, events own agricultural difficulties,trongto prevent dangerous famine In North Vietnam. The regime's own Immediate answer to the3 harvest seems toightening of distribution controls, in an effort to stretch limited rice supplies by ensuring that everyone consumes his fair share ot secondary crops Before the4 harvests, living standards will probably decline further in the cities, and critical food shortages may appear in some of the thousands of villages. Ftirthermore, prospects for the June rice crops are not bright, since transplanting seems to be lagging behind theate

here is little prospect of any real resolution of North Vietnam's food problem, at least for some time to come, Hanoi has explicitlythe most practical solutions on Ideological grounds by giving heavy industry priority over agriculture. Emphasis on producingexport crops to exchange for food Imports (as urged by the Russians) is considered Inconsistent with an "independent socialistince this policy would render th* economy dependent on foreign markets and subject to foreign domination instead. Hanoi proposes to increase the yield of existing (arm land through investment and technical mnova-tson. and to open up new agricultural areas by resettling ethnic Vsl-namase tn the mountain regions now sparsely inhabited by minority races Neither of these programs can be realistically expected to aUe-

this admission was coached. so spite of natural disaster, the total output o( rood ffi terms ol paddy wasUUoon lew. thr rrfimr tu peo>ecUnaj an annual outputillion ions by IBeS to Seep up with It* population increase. Accordlne lr> North Vietnamese naure* performance In recent years has been as follow iln million meLrtt ton, of rice equivalents; IBo*-ft7,Itej-M.

-

viM.lt the basic food problem In the near term. Indeed, we believe the situation is likely to get worse over the next year orso If the weather should prove adverse.

Transportation. Despite Hanoi's considerable investment in transportation and communications. North Vietnam's transportation system cannot adequately support the industrialization program. This Is due not only to the rudimentary structure of the system but also to poor planning and inefficient organizetion at the national and local levels, the use of large numbers of unskilled personnel, and the lack of maintenance equipment and storage faculties. Only those areas of North Vietnam served by the limited, French-built railroad system have sufficient and comparatively efficient service. The railroad system is vulnerable strategically, since the lines all radiate from Hanoi with no alternate rail facilities available for any one line. Both the rail and the highway systems have many key bridges. The road system is poor, and trucks and gasoline are scarce. Haiphong is the only port that can handle large amounts of general cargo and petroleum in bulk. The Inland waterway system is primitive, and the country has few ships for inland and coastal transport. There are approximatelyight transport aircraft that can provide limited airlift.

Industry.he Hanoi regimehree-Year Plan, which conformed to Soviet recommendations in stressing light industry and the development of exportable agriculturalndustries inherited from the French were expandedement andnd new ones were developedood processing, enamel-ware, paper, androduction has increased impressively, though in absolute terms industry remains small.*

mphasis was shifted in the current Flve-Yearo heavy industry and prestige projects. However, North Vietnam has neither the domestic resources, the capital, the experiencednor the skilled labor necessary to create extensive heavynd the pace of economic development has diminished since the Five-Year Plan was launched. The Plan iUelf has faltered, and its goals

'Id 1MD. light raamjtartnrr accounted for two-thirds and raining and heavy manufacture for one-third of all Industrial output by vahsa.

'Hanoi statistics claim that industrial producOon. exclusive of bancocrafU. increased at an average annual rate of about S3 perccci from ISMhis fig-robably inflated, however, and It sunt be reeoerabered Uies North Vietnam beganmail base In ISM In ItSZ, the van* of agrtcnlWral pro-dacticej tUH accoaated for abortercent and indiutrta] ptoducUocexclofivr of heneacTafu. for only abortercent of North Vietnam'*OW

'Managerial deficiencies haveource of concern to the regime for some Bar.rained technician* and skilled workers comprised lees than three percent of the elvUlan laborthe ragUne itatlf has admitted that the level of competence In this snail pool ot trained talent Is still very Sow.

were revised downward inonsiderable construction haa been started and some progress has been made, out the quality of North Vietnam's Industrial output remains low and lu real contribution to the economy bj slight The bulk of the country* heavy uio^stry is concen trated within the small rectangle formed by the four cities ol Haiphong Thaj Nguyen. Phu Tho. and Nam Dinh. and the power essential toproduction comesew keyhere are Indications that Hanoi is concerned over the strategic vulnerability of the ctmntrvs industry and transportation.

Trade and Aid North Vietnam's lack of domestic capital and technical skills, coupled with the regime's desire to industrialise the country rapidly, have made its economy crucially dependent on foreign trade and aid. In the, the DRV receivedillion dollars of credits and grants frommunist Bloc almost half from Communist China. North Vietnam's trade has more than tripled5 and now stands at0 million.f Uus trade la with the Bloc, roughlyercent with the USSRercent with Communist China, andercent with the European Satellites, mainly East Germany. Csechoalovakia. and Poland. The prmc.pal Free World trading partner Is Japan The DRV has imported all its POL. iron and steel, railroad rolling stock, and vehicles, and most of its machinery and metal goods, spare parts, industrial chemicals cnermca: fertilizers, and raw cotton.

North Vietnam haa never had an export surplus and moat ol IU trade deficit (about seoas been financed under Bloc assistance programs, which consisted maln'y of grantsut have been Largely credits la the years since then. Bloc aid and technical assistance will continue to be crucial to the Industrialof North Vietnam The USSR has made credits available forand. together with the European Satellites, has providedand equipment for heavy Industry, as well as motor vehicles Soviet and European Satellite economic assistance for the current ttve-Year Plan haa been scheduled primarily for projects In the fields1 orpower, coal and apatite mining, engineering, chemicals, andThe Chinese Communists have supplied largeof basic materials and manpower. They have alsoew heavy industrialssisted in the rehabilitation and expansion

example. Um origlDal Man callad for Um prodacttoo oltons ola rear (SO percent colna lo steel) and Uie Thai Xgajm plant was athed. tiled .'cr completion in imo with aannual capacity0 tons. Thaint blast furnace, however, was not pot Into operalion until February

'Baa plants aceoont torpercent of tbeower sapper of the mam and ana supply about OS percent ol the lota] electric power to Northpower to Um urban araaa of Hanoi and PJsSjfceaaj

of North Vietnam's transportaUan and irrigation system, and made appreciable contributions to the growth of light industry. Blocassistance has included not only the loan of foreign technicians and advisers but also the supply of technical data and the training of North Vietnamese abroad '

seriousnessessation or suspension of Soviet andBloc economic aid and technical assistance to Northdepend chiefly on Communist China's willingness and abilitythem, the speed with which this could be accomplished,concessions that China mightutoff In deliveriesand equipment from the USSR and East Europeandisrupt the current industrialixatloci program, at leastThese consideration almost certainly impose someDRV leadership from associating too closely with Peipmg

IV. MILITARY PROBl EMSOSPECTS

The total number of Bloc technicians sent lo North Vietnam Is unknown, but the number of foreign advtstrs and technician! tenladlng laborers) In theat any one time probably has been0 BaUmates of the number of Bovtet technical personnel present In North Vietnam at sny^itMrom

0ear; tome of these are technicians, bat moat are laborers whose kveb of skill may not be much higher than those of North Vietnamese workers

Considerable modernization of the armed forces, known as People's Army of Vietnamas taken placehough progress has sometimes been hindered by intra-Party political maneuvers and, more importantly, by conflicts between military and civil needs The small pool of Vietnamese technical talent Is not adequate far military or civil requirements, let alone both., huge numbers of military personnel were diverted to agricultural and economic tasks Such diversions seem to have stopped1t the time when Hanoi began Intensifying its Insurgency effort In Southut army units are still being exhorted to grow their own food.

The around foveas The core of the PAVN is the regular army of perhapshousand men. We believe the army is organizednfantryrtillerynfantry brigades,nfantry unit which may belvtsonrigade There Is evidence that the army underwent considerable reorganizationnd that some of this involved "brigading" units formerly structured as divisions, but the details of and reasons for thisremain obscure. What we know of Its deployment suggests aposture: Four of Its five accepted infantry divisions and its

only artillery division sot believed lo be stationed In the Red River delta area around Hanoi and Haiphong. Sincermyhas laid primary emphasis on conventional warfare. Nevertheless, guerrilla tactics continue to receive attention, and we are aware of special courses for the training of prospective infiltrators to South Vietnam

The strengths of the army Ue principally in Its experienced and loyal officer corps, Its disciplined and tightly controlled organization, and its reputation as tbe conqueror of the French. Unlike the Lao Dong Party, the army is primarily of peasant origin. Its Individual Infantry soldiers are inured to hardship and highly adaptable. Many have had or are receiving combat experience in the Hanoi-directedrnovernenls in Laos and South Vietnam Recentrmy has generally adequate stocks of conventionalthanks primarily to Chinese assistance. The PAVN hasits holdings ol Ught artillery and medium antiaircraft artillery weapons through Soviet and Chinese Communist sources ln recent years, but it continues to hold only modest quantities of medium artillery and Is not credited with any heavy artillery. There are some indications that limited numbers of Soviet tanksnd PT-7fls) have been received to augment the small number of captured US and French armored re hie lea known to remain In the PAVN inventory.it is unlikely that tbe PAVN has yetignificant armor capability.

Supplementing the regular army is an armed militia ofhich. In turn, forms partrained reserve which mayofn all. These figures are based onather than evidence. There is also an Armed Public Security Force under the operational control of the Ministry of Public Security and used primarily for internal security functions. This Is conjectured to have aboutattalions and to contain something0 men.

The Navy The Navymall coastal defense force with no slgnificanl deepwster capability Its principal equipment isrommunist Chinese Swalow-class motor gunboats,oviet motorboats,ubmarine chasers. The Navy guards againstand Illegal entry or exit, conducts some mine-laying, and participates in some clandestine operations in support of the Viet Cong.

The Air Porte. North Vietnam Is not bettered to have any combat aircraft at the present time, though the foundations for the creation of an air arm have been laid. Headquarters, maintenance, and support organisations are being developed, and much work has been done on airfield improvement and construction The North Vietnamese efforts in this regard derived considerable impetus andterms of equipment and practicalthe Soviet airlift into Laos.

which began Ln0 and extended through2 When the Soviets withdrew from this activity they left most of their equlp-rnent behind, includingransports which more than doubled the DRVen lory There have been consistent but unconfirmed reports over the years that Vietnamese pilots have been receiving flight training In China and various Eastern European countries. It isthat China could provide fighter aircraftmall Northair force on short notice.

North Vietnamese Atr Defense. The PAVN's capabilities In the Acid of conventional antiaircraft artillery have improved over the past several years. Defense against modern high speed aircraft is still rela-Uvety ineffective, but against helicopters, transports, and propellerPAVN capability would probably be good. Similarly, the present North Vietnarnwe air control and warning systemimited opera -Uonal capabilityodem air threat Thereadar net of aboutarly warning and Ore control installations situatedthe country, but the radars consist of obsolete HUS, DUMBO. WHIFF. FIRECAN, and modified.ew older type KNIFE RESTS. Mainland Chinese radar also covers North Vietnam, though so far as we know it is not at present coordinated with tbe DRV net North Vietnam is not known to have any surface-to-air missile capability

Communist Bloc Military Assistance. Tbe PAVN's program of standardization and modernization has depended almost entirely on Soviet and Chinese Communist technical assistance and provision of materiel for Its successful Implementation, though no reliable breakdown on such military aid ts available. Reports of the presence of Soviet-design small arms, artillery, tanks, and trucks have been received over the past nine years, but the proportion ot these which may have been supplied by the Chinese has not been eatabtished. It ts probable that Soviet aid in the form of artillery and vehicles was predominantut since that date Hanoi is believed to have looked increasingly to Pelping for supply of suchwell as for ammunition of all types. All the mortars and recoilless rifles, other than those captured from the French, are believed to be of Chinese Communist manufacture. Similarly, the stock of small arms such as2 mm rifles3 and2 mm macruneguns. although of Russian design, was probably supplied by Communist China Because of Pel ping'sin supplying its own national needs. It is probable that Northwill continue to depend upon the USSR and the East European Satellites for heavier and more complex Itemsrmored vehicles, heavy artillery, and perhapsOL appears to be provided in part by Communist China, with the remainder coating from Soviet or East European sources.

North Vietnam's Military Weaknesses. North Vietnam's major military weaknesses derive, directly or Indirectly, from its deficient

nological and Industrial base The DRV can produce only limitedof mortars, beaookas.ine* small arms, and ammunl-Uon. but dees have aome capability for anna repair Major deficiencies include Inadequate supplies of modern heavyhortage of trained specialists, technicians, and qualified Instructors; low levels of education: and present lack of air and naval support and insufficient armor for conventional operations. Despite the PAVN'a efforts to standardize with Bloc equipment, considerable quantities of Japanese, Oerman. French, and US armament are still in use, greatly complicating maintenance and logistics support These various weaknesses andwould not be likely to hamper Hanoi's support of orin insurgency-type operations. However, we do not believe that Hanoi couldarge-scale military undertaking for anylength of time without substantial continuing assistance fromsources.

V. THC SUPPORT Of INSURGENCY

outh Vietnam Infiltration from North Vietnam has longthe Viet Cong with political and military cadres and technicians who are usually dispersed upon arrival to lead existing Viet Cong units or serve as nuclei for new or expanded units We hare receivedreports of infiltrated units remaining together as such, but this seems much more the exception than the rule Available evidencethat personnel Infiltration Is primarily of significance in providing leadership and technical skill rather than contributing appreclab'y lo gross Viet Cong manpower. The Viet Cong get virtually all their food and norimiiitary supplies locally

he bulk of Viet Cong ordnance continues to be obtained by cap-lure from Saigon Government forces, try drawing on reserve stocks cached prior tond,easer extent, by local Viet CongHowever, the increasing amount of heavier equipment now being captured, together with the apparent steady Improvement tn the armament of Viet Cong forces, suggests that in recent months morehas been coming from outside South Vietnam Most of thla, we believe, comes from PAVN stocks rather than directly from Communis! China Until the past year or so. it was believed that moat equipment brought from North Vietnam was carried overland, mostly through Laos, and perhaps some through Cambodia. There Is evidence that some materiel is now being shipped by sea, either directly to southern coastal areas or to be smuggled In from Cambodia. Hanoi's strategy seems still that ol winning control of South Vietnam by subversion andbut there are some signs of Viet Cong unitsoretype being created throughout South Vietnam, particularly in the central highlands If such units were established, more equipment would probably be forthcoming from Hanoi.

o far, the coat to North Vietnam of Its support of tbe Viet Cong Insurgency has been relatively slight ln comparison to the results achieved Hanoi could almost certainly substantially step op theof cadres and introduce PAVN units of up to battalion state Hanoi could also probablyertain amount of additionalHowever, If the nature of the war came to require major Items of military equipment, to provide this would probably Interfere with (he PAVN's own needs and require access to foreign supplies

oot. In some respects, it has been less troublesome for Hanoi to support insurgency In South Vietnam than In Laos: The DRV has to supply food, the Pa that Lao are not nearly so resourceful or able as the Viet Cong, and PAVN units have been put into the field and in some cases more or leas permanently stationed on Laotian soil. We believe that Hanoi can continue the type of activity and support It Is now engaged in, and perhaps increase the quantity of troops and equip-ment involved

VI. THE OUTIOO* FOt NOBIH VIETNAMESE POLICIES

orth Vietnam's Ortenralion. The Sino-Sovict split poses adilemma for the present Hanoi leadership. Except during the period when It was protected by French armseriod which coincided with Chineseietnam has never been able to Ignore its huge northern neighbor, by whom it has twice been occupied, oncehousand years, and with whom It has traditionallylient relationship. Considerable evidence exists of continuing antipathy for the Chinese in the DRV. For nationalistic as well as doctrinal reasons, Ho Chi Minh would obviouslynified world Communist move ment more or less directed from Moscow to any polycentxic system in which nearby China could dominate the DRV Ho has long been aadvocate of unity in the work] Communist movement and has used his considerable prestige in every way possible to keep the breachMoscow and Peiping from widening. Yet It has widened, and the DRV has found It ever harder to stay on the fence. Hanoi cannot Ignore Chinas propinquity and substantial assistance, nor the fact that China's policy Is more consonant than Sonet strategy with Hanoi's immediate Interests in acquiring control of South Vietnam. But It is equally Impossible to Ignore the ioriger term disadvantages of opting definitively for either disputant, since either choice could involve not only the loss of Important outside aid but the risk ofhinese satellite.

or the past four years this dilemma has plagued Hanoi, andgenerated considerable bitter strife within the higher councils of the Party.hile, Hanoi sought toecision byand gestures toward both sides InHanoi became more

concernedMoscow's policy of detente with the West and Inclined more and more toward Pel ping The test ban treaty threwoncrete issue that could not be hedged, and North Vietnam refused to sign. The communique of the3 meeUng of the Lao Dong Central Committee. Issuedonth's delay, comes down on the Chinese side on most doctrinal Issues, but does not join Peiping's direct attack on Khrushchev himself Instead, the Lao Dong document carefullyrevisionist heresy from the erring dextrine* of brothers who should be kept within the fold.

o far, Moscow appears to hive appreciated Hanoi's dil-rruna. for there Is no Sign of curtailment of Soviet and Bast European trade or aid. We believe that Hanoi, though continuing to side with Pelptng on most Issues, will maintain as cordial relations with Moscow aspermit and will seek to avoid toohinese embrace.

he Conqueu of South Vietnam. DHV leaders almost certainly view Communist prospects in Sooth Vietnam with considerable conn-denes, and believe that their program of Increased pressures0 has onset both aaruer OVN progress and subsequent US massiveThe DRV apparently estimates that It can wear down the South Vietnamese will to resist by harrying OVN forces, derreoustratmg their inability to protect the villagers, and exploiting legitimate grievances against Saigon officialdom

umber of factors0 have greatly aided theseendeavors. President Diem's government grew less effective, and South Vietnamese grievances and vulnerabilities rose DRV-srionsored gains In Laos provided secure routes for Infiltrating additional arms and cadres into the South, and tbe Laotian wttiement2 raised doubts in South Vietnam about US determination. Despite increased US support, the OVN has not yet shown Itself able to cope with the pouticaJ-military Wet Cong threat The South Vietnamese haveDiem, but the effectiveness of the present successor rule has yet to be Droved Finally, French championing of neutralism, and the impression in Saigon of growing defeatism within the US. haveHanoi's confidence.

he French Ingredient. The Indochincse picture has recently been complicated by French initiatives. Hanoi would not consider any re-establlshment of French control or dominance in Indochina, but would certainly prefer French presence to American. It may view Franceossible provider of economic aid, especially If the Sino-Soviet quarrel eliminates the USSRource. For the moment, Paris. Hanoi, and Pelping seem to share the cornmon objectivemtnaiitig the US presence in Indochina, but so far the Communists have apparently not given the Preach neutralisation idea much encouragement. At awe believe the Communists wul make whatever use they can of

French gesture* and initiatives to confuse Western opinion, and to increase popular sentiment In the South for neutralism and negotiation.

Vrutrofum and Negotiation. Hanoi has exhibited little Interest In an International settlement guaranteeing neutralization of SouthIts official posture has been, and remains, that the Southstruggleurely internal affair, though it tt In sympathy with the aspirations of the "National Front For the liberation of Southhich Is completely controlled by the Hanoi-directed Viet Cong Hanoi's minimum condition for settlement {withdrawal of the US presence) has not changed, but Its tactics are probably shifting and becoming more flexible. The "Front" may try to capitalise on its gains and on wu-weariness in South Vietnam by attempting tooalition "neutralist" regime in which Itey role. In any event, Hanoi would almost certainly consider any form of "neutralist"as simply an in term step toward complete Oornmunist control, and, whatever agreements are signed, we believe that the Viet Cong apparatus would not be dismantled.

RV leaders probably believe that the QVN will to resist is waning and has been further reduced by Ihe current surge of neutralist talk. They may feel the same tt also true of the US. Hanoi may try to speed the process by further mcreasing the pressure. If so, we believe DRV aeuon would be confined to such steps as increased Viet Congsupported by better and heavier weapons, and by heightened Wet Ceng terrorism tn the ciUes. Thus they would hope to promote awhere the US would have toace-saving formula for retreat, or be asked to withdraweutralist South Vietnamese regime We believe that Hanoi will not undertake an invasion orayor covert commitment of DRV military units; we see no indication that the DRV leaders are disposed to stimulate drastic US counteraction.

ht Situation in Loos. Hanoi's goals in Laos have been In many rrspecte more limited than tn South Vietnam North Vietnam already controls enough Laotian territory to further its objectives in South Vietnam-, Hanoi, while working to build up the Pathet Lao. wan satisfied to see an Independent, though weak and complaisant, central government.anoi seems to have decided that It needed sufficient control In Laos to protect North Vietnam's western flank and to secure lines of communication Into Sooth Vietnam for the real Insurgency Hanoi was about to start there. These objectives have long since been achieved

ore recently. North Vietnamese mvolvement In Laos has been largely concentrated on protecting their investment and bolstering the position of the Pathet Lao. When the Pathet Lao has gotten into trouble, some increased. If temporary, North Vietnamese participation has often been necessary. For example, the recent FAR Neutralist

capture of Karrind Lak Sao was followed by an effectiveonce Vietnamese reinforcements became available. We view the North Vietnamese commitment In Laos as being, in their view, somethingideshow, but one paying dividends in combat training, border security, and secure access to the South. North Vietnam will probably introduce whatever PAVN elements are required to maintain the present Communist position in Laos, but the Communists will seek to avoid Initiatives that they would consider likely to provoke US military action. However, the Pathet Lao, with North Vietnamese assistance, can be expected to strengthen its hold In Laos and continue to erode the politi-cal-military position of the non-Communists.

t the moment, the situation in South Vietnam and Laos, coupled with increasing international interestegotiated settlement Inseems to be hastening the achievement of Hanoi's goals. This may be so, but for reasons Indicated above, we do not believe that North Vietnam is playing entirelyosition ofecade after Dien Bleo Phu, Hanoi Is still waiting for the full fruits of victory. The North Vietnamese people have seen the bright promise of Independence faderab existence, worse in most ways than under French rule and enforced by more onerous controls The population is rising and the food supply declining. The Party has seen brave plans founder, and current development effort* require conditions for success which may not obtain If present pressures continue. We do not anticipate any imminent collapse in North Vietnam, but the eventual departure of Ho will probably Introduce severer strains than any the regime has yet faced.

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