Created: 4/17/1964

OCR scan of the original document, errors are possible






i Soviet Naval Shipbuilding


Naval Ships

k Factors Affecting Overall Soviet Naval

Karitiar Shipbuilding,


Diving Research

Unidentified Soviet Shipbuilding

Soviet Shipyard

Chinese Naval Shipbuilding

Maritime Shipbuilding, Chinese CoTmnuiikot Shipyard

Satellite Merchant Shipbuilding, Satellite Naval Shipbuilding.

Minutes or Conference (Cont'd)


European Satellite Shipyard

Soviet Bloc Imports of Maritime Ships

fron Western Countries,

he Growing Power of the Soviet

Maritime Fleet,

Porthe Impact of the Growing SovietMarine on Free World

ist of Delegates and

Appendix B


OF the KSVET bloc merchant FLEET* compareg TO world



including Communis China.

Soviet Navaliscussion


A. Hew Construction

At the- present time construction of five Identified classes of submarines continues in tbe Soviot Union. Theeg classesen arbitrarily designated as:

"K" Class -

"E" "H"SN

u. "F"S (long range torpedo attack) "J"robable

A summary of construction2 and estimated construction3 is provided in Table 1.

"H" Class

Construction of this class of nuclear ballistic missile submarine continued? att Severodvinsk. It is estimated that three units were producedo*,al of tenClass constructed there since l'yy.*. Construction is estimated to be continuingate of three units assignedivingotal of thirteen units. The project number of the "H" Class remains undetermined. Thin class is currently identified as being operational only in the Northern Fleet.

"E" Class

Construction of this,class of nuclear cruise missile submarine continued Construction is att Komsomol'sK, on thc Amur River, and is estimated to be continuing. Two units were producedne of which has since been equated to project O'fj and estimated as the lead unitecond generation of the clutn. These unitr.otal cf sixt Konrvtvaol'

Itcmja (Cont'd)

A construction ratenits hos been assigned at Komsomol'ak3 for both version* of the "K" class,otal Ofnitsfc.

class la currently operational only in the Pacific Ocean Fleet. No "E" Class submarines ore expected to be constructed in the Northern Fleet

"N" Class

Construction of this class of nuclear torpedo attack submarine continued Construction la ateverodvinsk, on the White Sea, and is estimated to be continuing. It is estimated that three units were producedotal of ten "N" Class constructed there onstruction rate .of three units has been asalgned3 Tor therom Severodvinskotal of thirteen unitsU. The project number of th-Class renalns undetemlned. This class is currently identified as being operational only in the Northern Fleet.

"F" Class

Construction of this class or conventionally pewered torpedo attack submarine continued2 at the Sudoinckh Shipyard at Leningrad with no evidence that construction will be terminated in the near future. The total number of *F" Class submarines launched at the Sudomekb yard6 recently reachednits. It is estimated that an annual construction rate of four units wm be maintained3 with the posoibillty that sonw of the units may be the "J" Class.

Tn addition lo the known Sudomckh units, three additional units of the "p" Class built at Severodvinsk have been added to the current Soviet Submarine OOB.

"G" Class

Construction of this class of ballistic missile submarine is estimated to have continued2 ai both shipyard Involved in the program, Severodvinsk and Komsomol1 sk. It is estimated lhat sixe completed at Severodvinsk. These units were added to the

Soviet Subaari* OOBotal ofC" Class currently operational

in the 'Northern Fleet.

One unit was completed at Komsomol 'sk2 and added to thc CODotal of seven units operational in thc Pacific Ocean Fleet.

It Is estimated that the "C" Class construction program was terminated

"J" Class

Limited intelligence is currently available on thisnew class Soviet submarine which first appeared in the summert la currently estimated that thla unitruise missile configured, conventiomilly powered submarine. elieved that the submarine was constructed at Sudomckh Shipyard.


Table 1











_ 3








Severodvinsk Koosonol'sk

Est. Built by3


6 j. 10

L3 29


Includes7 In the Northern Fleet.

C. Conversions

-W" Class Conversions

The total number of "IT Class COnerMOMcarriesnits of the "R" Class asCU/v

converMons on the Soviet Submarine COB. The remaining coiversioc*peflncted innd include the SINGLE CYLINDER, TV IK CYLINDER, CANVAS BAG. and LONC BIN configurations.

"G" Class Ex-FT

At the present time there is no evidence relating to"G" Class submarliieRimilar cnnflguntisr orbtvrged mis*lle launch capability of FT err. Fleetrom evidence available, it cannot be determinedpo vjfciwirine exists in the Pacific Ocean Fleet at the present lime. There ii

no evidence to confirm or deny thc existenceonversion program to retrofitystem on the "H" Class SSBN in the Northern Fleet.

Sonar Modification program

A "Z" Class submarine, configured for improved ASW performance, was recently sighted in the Sea or Japan. TAYBR1TK sonar window eight feet by eleven feet was located in the leading edge of the sail, and the forward deck sloped upwardulbous bow which probably housed an array type sonar. This could indicateodification program is underway to enhance thc "Z"apability.

D. Force Strength

A brief suaaary of the estimated Soviet submarine force strength and composition asctoberl963 provided in Table 3-


Table 3

Est lasted Soviet Submarine Force Strength and" Composition



Diesel Powered:








* rr.*'. "R" La oonotruccloeuilt Ccr'klv.


E. Characteristics

on new ^" han*es lncharacteristics,during tbe past year, are discussed herein

olSL in characteristics


ii nn' has been given to the

tfU^the sail.

'^ reBaln* Bt three- Thc nissilc^lievcd to be

be the same oystem employed in the "G" Cluou.

newestimates of power "and speed still stand. Ko

^ ITntregarfng been formed and

the best estimate of drive is still turbo-electric, two starts.

theger lenRihled for this class, r ls'o confirm or deny tbe existence or namelass

listed M haracteristics an- now

E class submrlneasdesignatedI".


Item in (Cont'd)

"IT Clasr.

Rcanalyela hap resulted in the

presently listed dimensional characteristicst. IOA,2 ft. beam. Aa with thc "H" Clsrs, Tour after torpedo tubes *re presently carried, based on the increased length.

Tbe initial propulsloo estimate still stands. "F" Class

There have been no changes in thc cbarieteristlcs o'f Class submarine during thc past year excepteanalysis

"C^ Class

have been no changes in tbe dimensional characteristics of thc C CLaas during the past year. The new view or.owage within the submarine is that the standard configuration "c" carries theissile of abouteet, making it no longer essential for tbe missile tubes to penetrate the pressure hull. It is currentlythat the missiles arc housed entirely within thc sail.

The "G"onfiguration is evaluated a?est unitore advanced missile system. Tbe missile tubes probably penetrate tbe pressure hull and extend to the keel of this s not currently believed thatT system will be backfitted on other units or the claou.

Kegardmg the propulsion system, it is currently relievedirect drive system cmployir^ three screws, lUbie "F" and "Z" Classes, Is used. Some ttSBDIU evidence still existf. however, indicating dicBel/eiectric drive and this pofNihility aannot be

'_j- Class

Inw Sovle*as phc.*ogr .p' -dMm Baltle,. Or. the baiiiioe. Itilicvrd that tbe :: ,-

Sudomekh. The ehsncterlStlCB arear'


SL. "the believed to have three screws

Propulsion of tbe

is believed to be conventional direct drive with

Hull Construction

efrort haa been recently expended in

ersonnel in an effort to determine whether theiaso submarineingle or double hull ship.

, . Althoufh "rtain ballast tanks are necessary, more, than aaeq-iato tankage can be located both forward and aft of control and reactor compartment spaces, as has been the practice with United if, in fact, the "II" Classingle hull. In view of the

wforuclear submarine,

^^nctca^blli^ PrOVld* "WM tanka8C' thCrCby

. B relieved that tb- most sensible designthe Soviets to follow, particularly -regard,ttackwould be .Ingle

Diving Depths

- ^ ffortpresent an estimate of

Soviet submarine depth eapabilmes/lieitations, two depth figures,

tmlt md

u Collapse Depth, a. listed, is derived rom the hoop-stresa formula utilising known and estimated data, and Isxplanatory. Normal Operating Depth Limit Is arrived at byactor of safety to the calculated collapse depth and

hIchine may descend and return safely an unlimited number of time*

Table 'i

Item 3b

Destroyers and EocurU KYNDA CIbbb dec

-the second KYNDA has been completed at tbe Zhdanov Yard, Leningrad, and put to sea on trials.

The third kynda is in an advanced stage of fitting out at the Zhdanov Yard and Is expected to coamwnee sea trials Ink.

The fourth unit is currently in an early stage of fitting out, also at thc Zhdanov Yard, and is expected to commence her sea trials ir the summer.

There haa been no intelligence to indicate that KYNDA Class is under construction at any other yards and thlti is not reckoned to be tbe case.

It ia expected that this programme will terminate after completion or the fourth unit at the Zhdanov Yard.


Inew class or doc was sighted near Tuapse In the Black Sea and was subsequently given the NATO name or KASHIN. This new ship, which is estimated to be the same length anfeet long, has marked differences in armament and propulsion (which is generally believed to be of steam and gas turbines combined).

The KASHINwas stated to be on ceo trial* in the

Black Sea in It was built at Niknlacv North Yard, and rurther units are believed to be under construction there ond are expected to complete at the rateer year, rrom this year forward.

Construction or similar ships appears to be In band at the Zhdanov Yard, Leningrad, the first or which, now fitting out, is expected to completek. The second ship of the Zhdanov progrwae is known to be under construction and is expected to complete


'tern jb (cont'd)

A steady future programme for these ships is expected to react: three per year5 (two from the Zhdanov yard and one from Nlkolaev, Worth Tard).

Undetermined Projcrt

urther Intelligence has been received on this project

it seems likely though that she Is of destroyer size and incorporates at leant some conventional gun armament.

There are still no indications as to the ysrd(s) where this project may be in hand.


There have been no reliable puirrlers to further conversionsthe only one known to be in

existence is generally believed to havene-off Job.

Unidentified Project

ttossibility that an unidentified unit of escort sire, which has been noted in the Black Seandncluding participation inile activity, represents an operational

The prototype of this new class which is known to mourrt MBUi forward, Is carried onecond unit ii expected to complete ot lUrolaev3 and in subsequent years two further >hlps of there expected to complete each year (one of which may come from Killnirgrid).


hurt tor , e-r

receivedis class durinf the yen;-estimatedcharacter inticsw agrr-d.

The -teady building; mteotal of nine oer rear, *grr i

d'voiopmc'i difficultieswith the go* turbine boost erg)-fitted In thtM escorts niU continue md might effect the future building rate fcr try elaas.


Hew ini-uiarnc-from the Black Sea and torenabled the dimensions and

estimated characteristics of the/*oTt, first photographed in theino berlv firmly established. It isagreed that the

currently under construction at Keren ana Knaoaroves, larri >od, at steady completion rates of six andear, respectively, rrom this year forward.


- diesel1 program has been completed

suggesting the resumption of thcrogram incorporating gas turbine propulsion.

- lo

Coii. tructlonestroyers and Escorts

* > 6 7 8





Nikoloev UV>








*' One of these may come from Kaliningrad.

. t9

Item 3c

Other NavalflClaaa HSF Construction has terminated. YURKA

In?rst photographs of an unfinishedobtained in Leningrad. Since then, other units have beenconstruction at the Ust iBhorn Shipyard,eningrad,sea in the Baltic.

is evidence that it Is also being constructed at, Khabarovsk It Is considered that one unit vas completed In Leningrad2 and six one is expected from Khabarovsk This steel hulled fleet minesweeper is estimated toeet longeam ofeetraft of seven feet six inches. Full load displacement Is calculated toons.

estimated the propulsion of the YURKA to be dicnel combined withwere of the opinion

that steam turbine propulsion was more likelyombination of diesel engine and gas turbine drive.


Construction terminated.


Construction of this wooden hulled coastal classat Hetrovaky Shipyard, No.eningrad, Itthat six unit* were completed through urtherexpected infive units

are expected from Bystryy Shipyard, Vladivostok, These ships are considered to beeet long,eam offeet and

a draughteet. Full load displacement is reckoned toons.

Thcorsepower Is expected toaximum spaed of

nots. She is armed with twoM guns.




No building rate wasthis class of ship. It was agreed to handle their order ofas ln the case of the DON Class, when they areLAMA was builtlack Sea shipyard at Nikolaev and wason 3 when she passed through the Turkishto the Northern

her toissile support ship with storage and handlingaccommodate all types of submarine or surface combatantthe exclusion of SABK, which, because of weight andrat ions, cannot be handled). viewhatMA

carries only ballistic missiles for submarine use, approximately ItO in number. Toe LAMA Is considered toeet longoot beam and l'<nch draught. Her displacement is ^SOO tons. Her maximum speed is thought to benots0 horsepower installed.

UPA Class AO

The UDA Class was first observe^ in the Gulf of Finland lnP and was photographed In Riga Thin uniti KM gun mount abaft the funnel. The TEREK, another vessel of the UDA Class, is based in the Northern Fleet and was associated with Soviet Atlantic submarine operations during the Cuban crisis Although the UDA Class Is classified as an AO because of its obvious oiler capability, these ships probably can function as tenders, with space devoted to dry cargo storage and handling In additionossible repair workshop. These ships oreeet longeam ofeetraught ofeet. Displacementons. Maximum speed isnots withorsepower. Fuel cargo and stores mts) thought to totalO0 tons ofons in fuel.


fittm,CHUMIKAN and CHAZIHA, were observed litting out in the Leningrad area in the summer They left

aWbaen observedr delivery to .he Pacific Ocean Fleet. It is considered that these Ships

were converted from already existing merchant hulls of the DZHANKOY Close formerly named DANGARAr,OSIICHELYK. "

:>hw that these ships arefeet long and9 foot beam and

ofeet. TheyRT ondisplacement0 tons. Their speed2 knotsiCO installed.

Guided Missile Fast Patrol Craft (PGMG)


The OSA program is continuing in the Baltic area ot

Shipyard, No.eningrad, and It is estimated to be continuing in the Pacific area at Bystryy Shipyard, Vladivostok. otal of 58

OSA PCMG's are thought to have been completed s expected that l'j additional units will be built,n Leningradn Vladivostok. Future units or this class may have gas turbine propulsion. Theyeet long and1 root beamoot draught. They are thought toons. Maximum speed Is considered to be UO knotBorsepower.


consider that this program ir continuingtrovsky Shipyard, No.eningrad, and probably also at Bystryy Shipyard, Viadivofitok,

believed that KOMAR construction endedna inat 1will be accomplished only when desired for transrercountries- that the Soviet interest in go;,

turbine propulsionvault In future PC* construction having this form or propulsion. KOMAR characteristics arc lengthnches, beamnches,eel. 5 tons, maximum sustained speedknots withrated horsepower. The following tableonstruction estimate of Soviet minesweepers and below3


Soviet Maritime

* Of whichOO tons built for East Germany.

Detailed estimates at Appendix how that Soviet yards are expeeted to deliverRT of ocean going vesselsRT)n increase or This Increase is largely accounted for by additional completions of cargo ships and tankers, tbe miscellaneous and fishing fleet deliveries remain almost tbe same. Bo estimates have been prepared for smaller vessels but there will be an increase to perhapsnits In tbe building of the most importantRT Kayak trawlers and tunnyt Kiev and Khabarovsk- Our estimates are as follows:




A Name

LeninSky Komsomol 0 0


Hikolaev South

Nikolacv South


Leningrad Baltic

Leningrad Zhdanov

Lening rad Baltic

Leningrad Admiralty

Len iiif- .

Khimik D. Zclinsky

Fizik Kurchatov

Ketallurg Anosov


Leninsky Pioriet;




Vytcg rales Schued-,




bsningrod Admiralty

Nikolaev South





E. Tammlaar.

KuroliS OKbela



Ha lakhit




FUhcry (Cont'd)


Chasovitin Gedris








okol ?

I> Nikitich

Hikolaev South






Inning rail Bultic

Leningrad Zhdanov


Kranny Oktyabr

Val. Toreshkova


Brntstvo Svoboda



Polotsk Prldneprovnk



Tcodor Nette

Vostock III

U-nlnsky Koturomol


Pcrekop Angueaa










Leningrad Baltic

Leningrad Admiralty

Leningrad Admiralty

Nikolaev South

- Zakharov


Vas Biyukher

Tcodor Nette


KhniE ttil





Askol'd Oskar Lu> MgacM0 -




Klaipeda Baltic




Itapolfls Charnas

Valery Bykovsky

Yury ;













Ltdgkol 3 d.t. I..


J! -

Item 5a

Spoclal Cargos

Thc USSR has on order in her own yards and in several otherarge number of cargo ships having certain unusual design features ln common. These ships all0 ton liftarticularly long and broad hatch over an equally long hold, in most caoes thiu length is around5 ft). Officially Intended for the transport of lengthy and bulkyteel rods and structures, locomotives, buses, trailers,hey are also well suited for the secure transport of military cargoes. All ships of this type thenwere seen ln Cuban trade in the summer* and the missiles which returned to the USSR as deck cargo on standard freighters were almost certainly taken to Cuba In the holds of this class. The ships allpeednots and the Japanese built series are capable of overnots. It in reasonable to assume thaLjorae _at least have the characteristics reputed of other modern Soviet merchant ships; already fitted degaussing gear and certain Installations applicable to use in condition! of nuclear warfare.

- *






On 1st3 there were atuch vessels In service, totnl orders are as follows:

elivered (l) on orde





Overall Total 73

These ships are all due for delivery by the end5 by which time tre USSR couldinimum of I* dF the PcreKop class after the lead ship which Is due this year. The type also re pre Mint? rhe only type of freighter on order in non-bloc countries except Phlp to be built in Yugoslavia fur which details are not yet known. If they are also of this type then the grand6 could be more thaneasels of.

J2 -


Dwlupment of Deep Diving Research Vessels Types of Vessels

deep diving research vessels bulLt or under developmentUSSR are described below.


everyanka" made Its rirst Accordingecent news item It has noour into the Barents Sea and three into the- and has dived as far0 ft.)- Preparationsmadeurther cruise in the Worth Atlantic.

3- According to one source five new research submarines were planned or actually under construction early0 but there has been no further Inforeatlon on this subject nor any overt reference torogramme (but sec paragraph lk below).


U. Thes the only deep alving device currently in operation; designed principally. Dmitrlev. Dlasodov of the State Institute for Projecting (Planning) tho Pishingiproryb-flot - in Leningrad and built in the Rultlc Yard Leningrad it has been widely publicized and described in the press.

5- pecial pressure chamber was built for testing the first to be completed, capable ofressure upndividual components were in fact testednd the complete bothyuphercan inside was tested in0 atquivalent, it war. ststcd, to tbe design depth0 ft.).

In0 acceptance trials were carried out in the Barents Sen involvingives to depths ranging betweennd 6OO m. InO the bathysphere was reported en route to the Atlantic on board thehe only vessel so far noted in association with it.

In the summer? it was announceditaev of thc Polar Scientific Research Institute of Marine Fishing ondR0 -hodecord by descending epth. in the Northnd In December the "Tunets" was reported back in Murmansk after carrying out tests ir the Barents Seointer conditions.

hen the Tirst announcements of the building of the bathysphere were maile, it was also stated that blueprints had been completedew class of research ship to carryevice; the "Akademikescribed as the firsteries or these vessels for service mainly in the Faras recently launched at the Kosenko Yard in Nikolaev. There has been no indications as to where the bathyspheres will be built; thc Baltic Yard in Leningrad is an obvious place but the Noscnko Yard should also be capable or building them.


9- In2 PDJFO asked Giprorybflot to prepare an outlinea bathyscaphe, designatedapable of divingepthm. The outline was completed by? and approved by PMROthat drawings should be prepared ino that the bathyscaphebuilt by

0 will be in the form of an ellipsoid with the built above the main hulluperstructure. It willmen, have an endurance ofours, radios of actionpeedknots and will. long.

Development of Deep Diving Vessels

organizations concerned with the development of deepare as follows:


1?. This institute in Leningrad is primarily concerned with developing scheires for new fishing and fishery associated vessels built not only in the Soviet Union but also on her behalf in Satellite and Western yards. Its detailed design function is not clear. It certainlys an ideas centre and probably approvea"lhe final blueprints; some of its personnel have acted as customers* representatives In the building yard.-but this may have been under sore previous organization. There is no proof that the Institute actually prepares final blueprints and some indication that in the past these have been the responsibility of the ship Design Bureaus. Theas designed by Aloksandr Nikolai'vlcl: Dmltricv and Mikhail Nikolaevich Diomidov, both of whom have been associated for many years with trawler design orror head of the Ship-Mechanical Department of the Institute and presently

- J* -


b (Cont'c)

Deputy Head of Ihc Future (long Terr) Planning Department. Following theesign theyrojectathyscape to dive0 m, This was to be cigar-shaped, . long 'i m. in diameter, hullm. thicko. diameter globe for observers but nothing further has been heard of the idea.

13- The CA 2CO0 Project was undertaken by the OKU of the Institute; the 0KB (Obshchestvennoe Konstruktorskoe Byuro)oluntary organization where work is done ostensibly in the free time of volunteer enthusiasts. Dmitriev Is Bead of this 0KB and Dlomldov Deputy Bead. The namesumber of the members of the Institute and of its 0KB are known; those mentioned asworking on the0 were as follows:


Tokarev, Alfred S.

Hazarov, Vyacheslav Yevgencvich

Flllipov, Viktor Rikolacvich

Ivanteyev, Peter Ivanovich



Kolosovsky, Yury Viktorovich in charge of the project

on the strength of the bathyflcoph<-


radio communications mflflmi

hatchea and "ipanipulators"

pi pine


ec l"

these, Tokarev, FiUipov and Kolosovsky werevsociated with Dmitriev and Diomldov In tha plan toathyscaphe0 a

Item rjb) VN3K0

14. The three bathysphere/bathyscaphe projects are connected with the Murmansk bused Polar Institute (PIHRO) in association with Giprorybflot but the "Severyanka" nas no connection with either of these bodies; it Is subordinate to the All-Union Research Institute of Sea Pishing and Oceanography (VNIFO) in Moscow. The Director of this. Zaltaev, has recently discussed his Ideasew research craft moreubmarine. This vessel would be able to conduct investigations on the surface and also submerge down0nd will be equipped with its own bathysphere which could be lowered to even greater depths from thc submerged researcht willurface speed ofnota and an underwater speed ofnots. There willesearch staff3 scientists, presumably In additionormal crew, who will be uble to leave the ship underwater to conduct their investigations unlng aqualungs. There is no Indication that this proposul is as yet 'my morecientist's dream.

Item 6

Unidentified Shipbuilding Projects

Unidentified shipbuilding projects consist of those projects currently under construction for which no class designation, orualified identification. Is available. reats submarine proj and, for the sake of completeness, contains all projects and project modifications noted ists surface shipajor rnivul ond non-naval Interest.



Des :gr. -OS)

TsKH parus


lass SS. Lack of construction Informationomsomol'sk suggests early car.calli.tian, of the tntire program in the Far East possibly ln favor of its construction at

Status unchanged since original notation.

Construction believed not

at Komsomol'sk.

Possible candidate for nuclear < submarine class at("H" or

Kcsioacl'sk (TsKB PARUS) Construction at Komsomol sk con-

firmed in "

Possiblyodified "C" clan. First bull frompossibly delivered Future status undetermined.





I. i>



o .h


O -O



o f-


V U3

p ti"

0 h C

t Ul

r- w

fl CM O


< ^l .O









-'OP-.SfcCRET '


hi [yard H'-vicw

Severodvinsk Shipyard fkpg

Changes inoneaval


It Is estimatedere completed? ending construction of this class at This includeshichlass SSB-

H-class SSH

New torpedo attack nuclear submarines have been identified3 and it is estimated that production of this type continues at Severodvinsk.

lass SSBN

New ballistic missile nuclear submarines have been identified in the Northern Fleet3 and we estimate that production of this type of iiubmartne at Severodvinsk continues,

clasc SSGK

uclear-powered possibly

nnp Construction at Severodvinsk Is implied

but we do not have evidence of construction of this projectnd it may never have started.


IO&al>ly buUt Btitnbe,n* co"Pieted1 ando! ,iugusttates that during

19b3 five new ruclear-powered submarines will join the Northern Fleet and that they will be better, bigger and faster than the "Leninskiy Komsomol'* Two of the new submarines are said tu have arrived at thc Murmansk base (Polyarnoye) early in the summerne more scheduled to arrive in September and two before ice closes the Uniteresumably all Tive are Severodvinsk new construction. There arc numerous similar

- WJ

n-porti and some of them state that the early nuclear submarines have been broken up or completely rebuilt at Severodvinsk. This raises the point that some or the early boatr. may have been counted twice.

Repairs, Modifications and Conversions

Ue have no derinite Information, but we assume that most of the repair work at Severodvinsk is carried out at the repair yard ZVEZDA except Tor dockings which are probably undertaken by Shipyard.


as supplyingfor the timber and cotton carrier "Suntar"tavashino) and that additional propellers werefrom Zavod

9 -

ore nuclear submarines went down the R. Amurn all; one -as sufficiently unlike the other to Suggest it may have beeifferent oroject.

t Vlh

fSeptember I'lhp nml wa; pm


This li the AMGUWA class. Thc first

the iwir in OctoberIn .lulv IQfiP.

Another AMGUKMA class was delivered lastmore hulls were under construction or planne-'

Equipment fro. SudoacWhYard

Fran Sudomekb's past production It is likely that the hulls are submarines. Since it Is unlikelyouldroduction it may be that soother class originally Intended for Gudomekh has been supplied, or merelyan use the parts.


It is likely that the new welding-assembly shop is oow being used.

ndhM nroiect (nuclear support shlo^ced


This Is the AMCUEHA class. The firstd/vn

the amur in October 1qmsailed In

Another AMGUTOtA class was delivered last year, know that more hullB ware under construction or planner"

Equipment from Sudoaekhiard

Froo Sudomckh's pott production it is likely that the hulls are submarines. Since it is unlike ljouldroduction it may be that another class originally Intended Tor Sudomekh has been nuppj led, or merelyan uiie the ports.


It is likely that the new welding-assembly shop is now being used.

*hull rtforowcl (nuclear supcort shlo)zr?stfd


elivery Base of

bearing In mind tha useS aturd, Is probably uaed for final fitting out Of nuclear submarines and nuclear support ships fromomsomol'ftk.

Vli-.divor.tok (PIKS) Delivery Bflitef:

Delivery base for non-nuclear submarines and surface vessels- Probably near or within the perimeter of.


Nothing new on this yard. Shipyardladivostok


The following is an estimate of theapv construction:


5 OSA-Class PGMC

6 -OKAR-class PGMC possibly with gas-turbine propulsion

considers that new KOKAH's will be produced only for transfer to other countries.



6 -

(PETYA class)


Hsy Aug.

-l delivered.

Sept. 2h

Oct. 26

spare parts to be sent from Ishora end for assembly work to be done on Hulltwaiting oguipment.

PETYA sightedn final stages omitting out

PETYA went down the riwVladivostok Hew.

(June) PETYA sighted fitting outroduction estimated as follows:




(Possible YURKA minesweeper)

- The leading propeller for

still needed finishing work. The leading hull of this projectas probably finisheduture productionear.

(RAKETA hydrofoil)

ds were aoo'-mbled in

There la almostontinuing requlrem-nt for this type ofIn the For Boot.



Other Projects

9 this yard wasvessels and

medium trawlers. In view or the current commitments outlined above the continued construction or such vessels is doubtful.

Khabarovsk Shipyard fj)6fl -

nown change in facilities.

Preparations for construction were being maoc0

xperimental shaft brackets was believed that 2

hulls would have been completed1 ib^is was probably ovcr-optlmistlc as' were still on trials in Vladivostok in September/? and experiencing considerable difficulties.

imilar effort on naval work la planned3 and later as obtainedhenere built each yesr, then an annual rateould be feasible.

Fishing Vessels

Hulls were still under construction

, may still.

One-delivered in1 and one In? " HSO Of SOI isOnSiOf on:.

- -

Cont'd) Sevastopol7 -

In3 an observer reportedulls alongside (which from description could be PETYA hullo)ulls under conntruction on the slips. This would support last year's estimater. of construction:

Hikoloev Shipyard_

The rollowlng merchant ship classes are under construction at this yard



The following naval and merchant ship classes are possibly under

conntruction at thl* vard:



This shipyard is known to be building TAVRIYA class refrigerated fish carriers.

Kherson Shipyard

Completion of Leninslrv Komaomol class cargo ships at this yard over thc post twelve months have shown that the annennment made lost year tliat tine between launches from each of tbe two lines had been shortened from six months to four months has proved correct.


It is expected that possibly six ships will be completed in this year: vurious reports suggest that these will be the last of this series andeliveries vill retain tbe same hull but with gas turbineriginally desTftned for thc apparently sbnndoj'iidOO dwt tanker project.

Kerch (Kamyeh Burun)2 -

The productionat this yard mkl

probably suffered the sane difficulties as those noted at theard. It is known that rectifiers ont and 2nd hulls'* were to be handed over inuggt'Stlng completion by the end ofyear nlthough It is likely that the hulls were not fully operational unt11

that3ew subchasers had been delivered and th could be nceounted forroduction1nHowever, this is not easily accepted usroject since in2 wij knowlasses c* VuMf"he uarri.

iy;> IWliKiQ yar i

2 this yard van building RAKBTA type hydrofoilb at anofear. Thin la based onproduction of 13

which moved north at the start of navigation. Theydrofoil is also said to be in limited series production.


Shipbui iding


.nd Conversions

There arcthat thin nhipyard is very busy

::. : lire



Severdlov class "October Revolution" was last heard ol' in Liepaja, but it is not known what she is doing there.



Thereemote possibilitylass probuble SSO may have been built wholly or in part at this shipyard.

one sdlp apparently has not been used for timber

carriers or refrigerator ships, therefore steel fabricating space would be available for the "J" program.

PKKJM class0 CRT ULAN BATOR: completedan 6}

PraiBNYAll: launchedcheduled to complete3

classT, largest merchant ship ever

built in the USSR. SOFIYA: launchedcheduled to complete: laid down Titting out Oct 63

VINOGRADOV class timberNbTTE: laidaunchedo

complete in3

M SEVASTOPOL class refrigerated ted

ussian-language broadcastannnounced that the firsteu class of refrigerated ship lor the fishing fleet would be constructed

Pont ^)

s still no signassenger liner described asv being under construction In Pravda Voitokaeningrad papers report that this suip is'only being designed there.

Modifications and Conversions

W class LONG DIN conversion.

Note: One LONG BIN conversion was undertaken Further conversions may be undertaken.

Missile Range Support Ship CHAZHMA reported converting at Zavod

ayul '-

Other Production

Heat exchangers for nuclear oub-tiriocs are believed to bethis

A Russian-language broadcast of lUctnnounced that tbe yard wasarge drum-type steam boiler for China.

Boilers, steam engines, diesol engines and propellers for other shipyards are produced at.

For several years they have produced chemical equipaent such as the several sets of fertiliser production equipment deliveredPA RusFian-language broadcast ofultated that the yardi-Is to manufacture on automatic plant'for purifying^hydrogen for synthetic ammonia production.

Production Summary

'rh- yard completed theironth plan in Octnd announced plain, to increase3 production of ships byer cent

Changes in Facilities

The two new buildings at the north end of !he..shinyardiniya The

light brick building nearest,Kosaya Liniya is reported to be an administration buildlrvv The four-boy shop should by now be complete

The new building eastJof Kosayn Liniya across from tbe intersection of Detskaya Ul. appears tohopigh. Uc have no recent information on this building, but by now it should be'completed.

oscow broadcast ofne V. SmiFnov complained that the welding equipment at the shipyard uas out of date.


Admiraltyeningrad, ex-Martl Yard

Shipbuilding -

ijcddkol 2


Herchant Ships

unknown: Launchedug 63

Moscow radio broadcast ofunnnounced thot three would be completedi which indicates that one more is scheduled to complete this year.

J) ANDREIlass crab cannery5 ART YEVCENIY NIKISHIB: Completed Aug fc


ompleted DecONSTANTIN SUKHANOV: Sea trials JO KayASTLIY DLYDKHER: Launched l6 Mar 63

Repairs, Hodiricatlons andons

/.ovodretains some technical responsibilities in connection with the icebreakerndpecial base at Murmanskor this purpose.

Other Production

A Russian-language broadcast of Jantated thatas producing chlorine storage tanks and other equipment Tor thc chemical


Item 'I (Cont'd)

Changes in Facilities

At the beginning of Marchthat the

yard's security perimeter fence had been extended to the northeast. The neu perimeter runs northeast to Perevo-naya taking in the tenements between that street and Mynsnaya. This change may indicate an intention to enlarge the Yard.

The third optical automatic plate cutter should by now have been installed.

A orantry craneiftonseach3 from Kirov Lifting and Transport

Equipment Works, Moscow. This crone was Intended to facilitate building two ships side by side with the reach Ions enough to reach over one hull and work on the other, wc have no evidence that the crane has been installed or of an increase in the number of hulls under construction at one time.

list lahora Shipynrd, Leningradaval

Production of cean minesweepers seems to have been phased out. Two were reported at the yardovnd one

The YURKA class possibly, meller minesweeper and was first sighted at Leningrad in This class is in series construction atithnder construction at one time. Six to be completed The shipyard capacity was estimated to be i6 YURKA class per year.

Sudomekh ShipyardnIngrad'-

FacU itles

Aay workshop his been under

construction sincet the NE corner of the yard.

At position kO, new very high screening has been installed on the


The purpose of thc covered way betweenoor and 't-door sheds Is not known. Sections continue to be moved by floating craneew caisson fits across the end ofoor shed slips.

Class Submarine Production

Hos. XXIII-XXVII were launched as follows:






k July

XXVI uly Ho. XXVII ovember

Nos. XXI-XXV left the yard.

No. XXVIII anuary



No. XXXI (Hid-September)

No. XXXII (Mid-December)

fly the end of3 Hos ixvi-xxviff had left the yard; 2

more should do so by the end of thc year.

At Sudomekh, therefore, oiart: hull No. XXVIII the producti" cycle has lengthened slightly to about months inoor shed andimilar period alongside fitting oul

Indication of Planned Production

Undcrs and Poses

These have been reported in front ofoor' diameter; TIKHI KHODirYEOPASHO sighted) and on the wharf at position UO {where theyV diameter).

Zhdanoveningrad -

Observation of this yard over the past two years has shown important developments in the utilization of its potential capacity. Since the beginning2 two open building ways have been occupied by major ships where only one had previously been in .regular use and the recent launching of three vesselshort space of tile from the covered building ways has shown that of the possible four ways three bad hulls under construction at the beginning3 while we believe that only two had been used over at least the past five years. hart of estimated hull construction is attached. Capacity of the yard to complete new ships may have been limited in thc just by refits to SKOBYY and KOTLIN destroyers and the conversion of two survey ships but the latest activityar. increase in hull steel fabrication without apparently any increase in working area. He had thoughtarge amount of prefabrication work war. carried out in the four door shed but usehird building vayhat possibility. ew probable engineering shop has been complete!3 south of the oldut the limited height of the building suggests it is not forwork. Tbe building bus threeitb office space on thc seaward side, dimensions approximately 2O0t. Further new construction is taking place on the landward side of the building waysppears toairly small shop. There are press reportsew crane on order to move sections uptoons in ueight.

We do not know which of the'lour covered ways an? in use butinclude the two at extreme ends of the building. There is uMvsto Show that 11

way nearest the four door shed was in use for KliOlti class tankers'. ngo. Latest photography of the ynivj however shows this area empty or more probably used for storing sections with shipbuilding on thc'nys served by two craneslide track between them.


Farly inhere were four unidentified hullu oeeo on/the outside. ater becamend the VTTECTWLRSaw*ositively identified and do extra vessels have been completed. orts of tbe hull shape and building'dates vc believe thatVII tbe BUKOVTNA which was moved into the four door shed after the launch of tbe IT-BEXISTAN and thatas an early sighting of the vytegrales which according to the press was laid down In. Thc theory that only two ways were occupied inside theestshe idea that early ships of the KIRGIZFTAN class were built two simultaneouslyingle alip; there is roomulla and some confirmatory evidence that thin wan intended, launch dates of Individual shipsost irregular pattern If this uas not the practice.

oted that the announced plan to bullaf the VYTEGRALES class timber carrier would limit theapacity to build destroyers. In fact3 there has seemed to be an increased emphasis on warship construction and the timber carriers are being builtate of onlyear. We have called the new class of warship PD (Flush Deck) although itossible it will be tbe KASHIH, building also in the Black Sea area.

At previous building rates KYNDA III might coarplete this year, KYNTJA TVV The passenger ship program should continue for at least one more year and more timber carriers will also be built

at adepend in* on tbeoc

this program may have completed but more of thc Flush Deck class are expected either on thc outside way or inside following the launch of KYKDA IV or in both siten.

- 6:

. It li Hi5J 55 JSSSS 5 it


5 5

5 S ; 2?

blank page

Fctrovskly Ostrov Yard fo, Leningrad

Reports on theave been few: and irregular but haveower level of activity. This may suggest that urgent requirements hove been met, over JO of the powerful OSA are now ovallnble. KOMAR conversions in the post two years any have been only to meet export orders.

Construction of the VANYA has beenery low level; work on thc KOMAR undoubtedly limits capacity but apparently only about six of the new HSC have been completed which is leas than the capacity of the yard.

Two new buildings up stream of the six door shed appear to be drawing office/administration type only.

Baltic Shipyard loop, Tallinn -



Merchant Ships


Rfpuirs, Modifications and Conversions

Weor SKDRYYs, KOTLINs> Js in the shipyard

probably under repair. The largest number was onulhen three destroyers and two minesweepers were reported.

The magnetic research vessel ZARYA sailed for Leningrad ?fc Julor Tallinn Tor repairs to main engines, hull and equipment.




VOLCODAR, Tirstew class of timber carrier to be built at Kaliningrad hart left on its maiden wynge. In3 It was reported that five ships (building yard not given) were in service on the routeixth on trials

Fron the past performance of the yard in building naval ships andontinuing merchant program we believe it unlikelyew naval "rejectill appear in any number except ot the expense of PBTYA completions.

Corkiy Shipyardmsooye Sormovo -


Another examination of theowever, shows that the launch slip betweenallsndere removed when thc larger hallas completedt would appear that thc smaller and earlier of the two Isteel cutting and prefabricatlon0 sq.nd sections are moved into the larger and never hall for final assembly onong slips


Series production startedEUT vessels ofor the Volga-Baltic waterway (which in to be ready in0 to be ready by then.

Construction of tbe 2nd trainET5KAYA TURKMENISTAN started, also of the twin-hull catamaran crane.

0 ecater river going hydrofoil) trials were completed and preparation randc for aeries production;.

RAKETAndydrofoils were completed.assenger sea-going hydrofoil accepted. CHAIKA hydrofoil completed, water-Jet propulsion.


7 (Cont'd)

coter hovercraft completed fcO passenger hovercraft is

under construction.

dlesel boats

tuot identified; nayMT).

Continuing order Toron ships. SOVIET TURKMENISTANhaving been fitted out

Cutomaran0 m) crane finished.

Work begun on gas turbine hydrofoil and on freight _

ugust BALTTYSK I, first ofVT ahios for the Volga Baltic waterway, left Corkiy.


Nothing new on this shipyard sine- the cvi^nce of lasB coastal minesweepers , vere being built at Zavod

3*tl and fitted out at thc Baku delivery base.

Rail connections have been improved accordingoscow radioofovhich relatedranch lino to Rybinsk had been built to connect with the new Gorkiy-Cherenoveto line.

Navashlno2 -

erchant Ships

NZHENER BKLOV elass cotton/timber RT. About alx ship) or this class have been completed at Zavod $i2 and others

may be under construction. Completions known

Include tbe SUNTAR, Hull No.completeduncd photographed In thc Baltic in

A Russian-language broadcast of 2fc Octtatedon capacity dry cargo motor ship Tor service in the Volga lad been completed.


Sosnovka.yard ffflO Nothing run* to add


No known chvnge in facilities.

The problem remains as to what Zelendolsk is building now that TsKBhove been *set up atnd

nysh Kurun As the leading yard for the

productionsubchasers in tbefO this

yard could be expected to continue with the production of na fur turbine

we consider that

actual production taker, olace at Kamvsh. Although it maythatof electric fans

wasdelaying assemblv work of hulls supports production atvidence is in favbr of Kumysh Burun, and in fact we doubt whether the width of the launching ways and the height of the doors ofovered slips at Zelendolsk would permit the construction

the poti class, at this yard.

Ofypes of hulls known to be at Kaarysb Burun in thc summer,eries seems the most likely to have originated from Zelendolsk.

It is assumed tlwit pusher tug production continues.

The Baltic Shipyard, Klaipeda -


Although Soviet navnl officers occasionally visit the shipyard, there is no recent evidence of any construction lor the navy.



Merchant Ships

silr. of3 productionavailable. The yard is reported to be building large andsUrajtravlers and floating dry docks. Fish factory ships RAFOLISjWgRT, launcbcd aboutnd VALSRYIY launched Both oreIY class. There nay be another of the class named, YURIY GAGARIN.

a this yard has bullV'^Sifeotlng drydocks for their ownseveral for other yards. Tbe'dHoocX;built at Klaipeda andVladivostok2 was oost probaoiy;bullt at thisocksons, (overall ^OOO tons) have been built atover the years';

Repairs, Modifications ond Conversions

Most repairs are carried out in tho Klaipeda Ship Repair Yurd (Sudoreamtoyy Zarod) north of the Baltic Shipyard. There have been reports that this yard has been or vill be taken over by the Baltic Shipyard.

ubordination changed froo Ministry of Fish Industry of the USSR, Moscow, to the Ministry for Engine Constriction in the Lithuanian GSR, Vil'n^us. Plan to increase labor forceU and operatehifts.

- a) -

Chinese Communist Naval Shipbuilding . Genera)

Hoval shipbuilding in Conaiinist China has nev reiched the third year in which no major combatant surfucc ships or .submarines have been laid down or produced. It is apparent tbit the Chinese Communist Navy (CCS) is attempting to maintain its status quo through programs of repair and overhaul- Tbere are also indicationsev ships are being modified, suggesting an attempt at modernization; but this effort is primarily directed toward the Type II and Type TV "W" class submarines, an obsolete warship androto-type Chinese version of thc "Komar" PCS*}. Naval construction in tba last three years has'at best been confined to the building of relatively few minor patrol craft.


Communist China embarked upon her fi^Pt significant naval shipbuilding effort With extensive Soviet material and technical assistance, the Chinese were able to commence assembly of five classes oforships: "W" Class submarine (SS), RTGA Class destroyer escortROh^lTTADT Class submarine chaserlass motor torpedo boatnd'T-'i3'Class fleet minesweeper

W" Class submarine (SS)

The "W" class submarine has been the most significant ship produced to date in Communist China. At leastnits were built at Kiangnan shipymil

in Shanghait Wuchang shipyards. Twenty-onewid been laid down before Soviet withdrawalithf this total accepted by the CCN. The last four submarines, conpleted

onths probably owinguck of spore parts or technical competent-.

2 . Other Classes

A summary of thelasses of Chinese-assemhled, Soviet designed ships appears In TabicRIGA Class DE; KRONSOTADT Class PC;lass motor torpedo boati3 Class (KSF).


Those programs mainly involved assembly of component flections prefabricated in the USSR. Chinese industry apparently developed the capability to support the.shipbuilding industry by production of some slmple componentn. Initially, the programs were closely supervised by Soviet shipbuilding technicians with thc Chinese providing little more than the labor force. With the gradual strengthening of Indigenous Chinese shipbuilding technology, the early Soviet supervisory role vas largely reduced to that of technical consultant. Still, the danger of ext-eme reliance upon. became apparent in0 vhen Soviet advisers were suddenly withdrawn. Economic difficulties notwithstanding, tbe full impact oo naval shipbuilding of thin withdrawal probably will never be known, but some consequences have become evident, hoot significant has been thc termination of construction of Soviet-designed ships. Including the postponement or cancellationodern destroyer programewer class of submarine, both of whicheast in the planning stage0

Chinese-version of possible^Soviet KOMAR Class (PGMC) Guided Ml'nsjjelloat

In February and* sighiiugsand one photographexistenceossible KOMAR type PGMG at Vuaung, boat Certain features of this craft appear to make it similar toversloo. Photographic Interpretation

hasT hull,n gun forward (twintair-step pilot house, "A" frame mast and atort catwalk extension as well as apparent missile launchers. It is not considered likely that the Soviet Union vould supply the CCH with this type, and there is no evidence of any having been transferred. Thus, this unit. If valid, is believed to be an indigenously developed craft modified from the available stock oflass PT.

By its appearance at Wusung, it can be associated with Shanghai shipyards, but there is. no evidence to link it with any specific yard. The launcher modification is within Chinese Ccaaminlat capabilities and the ability to design and produce an acceptable missile is not considered technologically Impossible. tep towards modernization by thc production ofnit is In keeping with the traditional Chinese Concept of using naval forces for coastal defense. There have been no indicationsissile has been developed nor ban this unit been noted in operation.

Unidentified Class Minesweeper

The only evidence of possible nev construction has been tbe appearanceossible nev class minesweeper st Kiouain Dockyard, Shanghai during Kay, June and3 (andimilar units at Whampoc). However, It cannot be determined if this class represents modification of an existing ship or has been builthinesereliminary study has established some tentative ship characteristics which combine features of3, KRONSHTADT CIosbt. Classndlass MSI- The acquisition of additional minesweepers wouldogical move In order to supplement theshlp minesweeping force. There Is also the possibility that this sHip has only recently been observed, but was acquired at an earlier date.

Future capabilities of the Chinese Communist Navy (CCN) will likely dependarge extent on the ability of shipyards to provide naval ships as needed replacements for the aging navy. The ability of Chinese shipyards to construct new ships for replacement of existing units directly affects thc slie, Bodernlty and obsolescence of the CCN. There is no doubt that Chinese Communist shipyards can construct, comparatively modern naval ships us they have demonstrated the ability to do this byubstantial naval shipbuilding program totallingtandard tons. some question aa to whether they could perform as well without the extensive technical and material assistance provided by the USSR - Over half of current naval tonnage consists of obsolete or obsolescent ships formerly belonging to thc Chinese Nationalists and built during or before World War II. This lncludeo all tho amphibious landing ships under naval control. Minesweeper strength orhips is clearly deficient. In the intervening years since Soviet withdrawal, the only naval shipbuilding completed from keel up hasodest number of patrol craft. This may result lessechnical Inability to produce larger combatants than from thc necessity of devoting output to merchant ahlp construction or hardware forroader demand exluto. Whatever the reason, the void In nuval shipbuilding has certain long-range effects on thc CCN capabilities:

Reduction In overall naval capabilities.

Reduce tbe troop-lift capacity of the naval ships by not providing

replacements for theear old landing ships.

impede the limited in3hore mlnesweeplng capabilities by

not providing replacements for minesweeping ships.


If developncnts in the CCH continue to follow the trend initiated there willontinued downgrading of operational andwith naval shipbuilding United to construction of Overall capabilities of tbe CCH will also decline ifno replacements for the rapidly aging ships acquired will probably be directed towardsatrolkeeping with the defensive posture of the CCN, at the. sacrificeaims. Improved Sino-Soviet relations with accompanyingcouldedeeming factor to the CCN, but would need toImmediately in order to check its




i I









Oil O O


o o o







3 3

2 as



Item 9

Chlcom Maritime

Evidence now available indicates that some increase in the level of Chinese Communist shipbuilding activity probably took place during the past year,ime when the completion of new ships was at its lowest level, and suggests that some increase in thc output of ships will uccur in the near future.

The decline in output of the shipbuilding industryQ2 parallels the general decline of industrial production in Communist China. Moreover, analysis of output during these years indicates that the new ships completed probably represent units in the. Unfortunately, because colapletlons over the Jast several yearselayed completion of units, output0 is of little aid In determining tire trend of future production, it has been necessary, therefore, to look at other factors thatearing upon the shipbuilding industry.

One of these factors is the construction of shipbuilding facilities. During the period of the decline of shipbuilding, Utc Chinese continue to expand facilities in several main areas.he Whampoti Naval Shipyardhe Chin Ling Shipyard In Nanking,he Hutung and Chiangnan shipyards in Shanghai. There is little evidence of any change of facilities at the other majorbut all thc major yards did receive considerable new facilities ln earlier years. The continuation of the expansion of shipbuilding facilities, therefore, even ifery modest scale, must be taken as su indication of an intention by the Chinese to resume ship construction at. higher levels than those currently observed.

Another factor is an increase fn shipyard activity observed since Although tenuous, thc increased number of references to shipyards and to work underway in shipyards is taken as an indicator of increased shipbuilding activity. Of related interest is an increase in diesel engine production activity that also began late Many of these activities concern smaller ships and engines with lower ranged of Significantly, it is with snail ship* that the shipbuilding industry has its greatest current capability.

Other factors point to some degreeeed for an increase in the number of ships. The Chinese currently have under major repair three merchant ships, one of which is UQ years old. Since this type of repaironsiderable Investment andyears of work, such an expenditureo year old ship would not be undertaken ln the West. Also, for the first time In several years we haveapital construction plan for ships. imited number of ships are Included and these are river types but they probably represent some form of priority construction since both tugs and passenger ships are included. Moreover, water transport figures hove increased3 The tonnage of Chinese ahlpo in operation for the first half3 is up aboutercent over that for thc some periodnd, further, most ships not in operation appear to beepair ratherold-up status.

An increase ln the general level of Chinese-industrial production was noted in the latter half? and continued The shipbuilding factors noted above, when viewedhole, suggest thatIncrease in the level of shipbuilding activity took placeSt.osilbly as early as late The apparent parallel between these two suggests that increased output by ,hr shipbuilding-industry is at least In port related to some recovery of the Chinese economy.

While the status of the national economy is an important limitation upon output an even more Important limitation is the significant lmbnlance within the shipbuilding industry created by the development of the Industry ir. two stages. Priorities were given first Lo the building of ship nnacmbl;rder to assemble components and equipment furnished by the USSR. esult the major Chinese ohipyordsumber of the smaller shipyards acquired modern facilities that ore now staffed by Inexperienced ship aosembly personnel. The basic support industry lagged behind the development of assembly facilities. reater concentration of investment and effort to broaden this supporting Industrial base wao begun lateB orith $pvlet assistance, this base for the production of components and equipment and for the design of ships was still weak at the time of tbe withdrawal of Soviet assistance0 It is significant that tbe Chinese hoveumber of merchant ships Since the withdrawal, indicating that the supporting industrial base probably produced the necessary missing components and equipment. Thc Small number of units, however, and thv tinw required roi completion ir.plhai the supporting base Is ttlll limited to small scale production



One new development within China muy have an Important bearing upon the Chinese shipbuilding industry. On 2flhe Standing Committee of thc National people's Congress announced thc formation of thc 5th and 6th Ministries of Machine Building. The functions assigned to these new ministries is not known, although the leadership of thc Ministriesefense orientation,efense industrial upgrading similar to that observed for the electronic Industry, with the crcution of the lith Ministry in

Of possible significance is tbe appointment of Fang Ch'iang as minister of the 6th Ministry. Fang is an Admiral in the Chinese Navy vho held thef Deputy Commander of the Navyndn0 lie became Vice Minister of the 1st Ministry of Machine Bulldlng. The shipbuilding industryart of this ministry until0 when the defense Industries were_subordinated to the 3rd Ministry. Between0 and the present the 1st Ministry has retained control of the non-military Industries.

the former 9tb Bureau hasto the levelinistryfunction of the 6th

Ministry is shipbuilding. The increased emphasis for shipbuilding in this change strengthens the likelihood of an Increase in output in the near future.

Construction of merchant ships2 is shown In thc following chart. Tho highlight2 was, or course, the completion of the LEAF FORWARD (YUKU CHIN).

There have been no completions identified to datelthough the KIN CHUas noted in early August about ready Tor sea trials. In addition, work Is continuing on the EAST WIND (TUNG EENC) and presumably on the second hull of the LEAP FORWARD class. Discussionon tanker, possibly or the CU1ENeries, has been noted as have referencesumber of ships for inland waterway use. Actual completion3 probably will be llalted'to

8 1


Chlcom Shipyard Review Da Iron

Mo knownacilities; but there is confirmationuilding alios, not ft. 2 thereuggestion of the construct lor of shipbuilding facilities sow distance to the South of Dalren, buthave no recent information on thc status of this project.

? the YUKH CHIN was finished, (she sank inhe sister ship was still ritting out in

Hu Tung

There is confirmation of the large new workshops in the north of the launching basin and the completion of the workshops on the southern end of the yard. It Is not known whether they have all been equipped.

2 this yard had on the slipsGB's, fishingoastal tankerefrigerated fish transporter.

International Dock Yard

Ho known change ln facilities.

In2 there wereGU/HTU hulls, under repair or constructionmall freighter.


3 the yard is to0 CRT river passenger cargo vessel and mayon tankers. Submarines reported on the ollpr. are likely to be back for refit ruther than new construction.

Wu Chang

No information on thelass yurd. Two new shipbuilding yards have been identified to tho south of the creek. Current activity probably limited to river vessels.

fD -

Item 10

Hew whumpoa, Canton

2 construction continued of new facilities on. corner oi Dane's Island. am has been built across an arm of the river to make an artificial harbor where filling in could provide slipsaunching way,arge workshop has been completed. It is not known whether machinery and equipment have been installed.


Item 11

Satellite Merchant

By the end3 it is expected that the tonnage or major merchant and fishing vessels constructed by the European Satellites will totalCRT representing an increase ofRT above the tonnage built This increase in tonnage is thc result of the production Of more ships by Polish shipyards. Despite this increase in tonnage,7 ships are expected to be completed3 as compared to Vik ships This numerical decrease can be attributed to tbe construction of fewer ships in the smaller tonnage ranges, particularly fishing cutters,

ourse, cargo Ships are the principal product or thc Satellite shipyards- he tonnage or cargo Ships"constructed wasRT- of the total GRT, an increase of0 CRT above the tonnage built The other principal types, in order of tonnage produced, arc fishing vessels, tankers, passenger ships and special service ships.

Poland is the leading shipbuilding country among the rive European Satellites. Polish yards producedor the total CRT completed by the Sutcllltesore than 3 East Germany produced i'"f> of thc total torjiage as comparedP. The other three Satellites, Bulgaria, Hungary and Rumania contributedach

One of the main features of Satellite shipbuilding is thc serial production of all types of ships. In the past, serial production rangedhips tohipsingle clasp. The greatest number of merchant ships of one type serially built were thelassRT which were produced at Budapest, Hungary. f these ships were built. This seriesill being builte clast has been oodificd and is nou known us thc KEYIA Class of whichnits ire known to have been completed to date. Other classes of merchant ships built in large numbers includenits of the Polish-built DONBASS ClassRT andnits of the East German-built KOIOMNA/ANDIZHAN ClassRT. Of thc tankers produced serially, theEDYA CUUANOV ClassUT has currently reachednits. With respect to passenger ships. East Germany will completeh and final unit of the MIKHAIL -CAMNTN ClassRT The greatest number of fishingf one type constructed serially was the medium trawler of




the SRT5r which soveral Hast German shipyards completed more than 7CO units during the.

The largest merchant ships building in each Satellite country arc as follows:

ln Poland tho BAUSKA Clans tanker0 CUT and several types of cargo ships0 DVTVT;

ln East Germany thc new IVAN FRAHKO Class passenger ship0 GRT and several types of cargo ships in0 DMT range;

Bulgaria recently completed its first ship of significantargo ship ofVT;

h) in Rumania the largest ship built hau been the GALATJ- Class cargo ahip ofDVT.

5) Hungary continues to produce small cargo shipsVT-

A detailed account of tbef Satellite shipyards Is shown in Table 1.

The greater part of tbe output by Satellite shipyards has always beer, ond continues to be exported; the Soviet Union being the principal recipient.he Soviet Union receivedc oft he total GRT produced, and it is expected that thc Soviet Union will receive Tbe total tonnage retained by the two leading Satellite shipbuilders, Poland and East Germany, has never exceeded one-thirdf the total output of their ohipyords. 2 both countries retained 3C* or the total CRT; and3 it is expected that Poland willnd Eaot. The output by Bulgarian, Riuwniari and Hungarian ohipyurdn averaged

0 GRT3 as cooperedRT, these three countries exportedf their shipyard production. Four of the Satellites, Poland, test Germany, Bulgaria mod

Hungary,esser percentage of their total output -to other Bloc

and Free World countries. Mo ships are exported by Rumania, except to

the USSR.

Puture prospects of the shipbuilding industries, as seenhlpbuilrtern ln their respective Satellite countries, is that these Industries will increase in scope, both in the site of vessels to be built and total annual output. Poland is planning thc construction of tankers0 DVT each and bulk cargo ships0 DVT each. Poland also hasO as the targe'- date for beginning construction of nuclear-powered ships. Although East G'-roany produced lessj thanroduction is expected to show rodent increasesnd subsequent years BulgariaRuma->io are ucbeduled to build cargo


ships0 DWT in the isnediatc future. Although Hungary will continue to build small cargoodest rise in annual output can be expected. It is significant to note that thc orders on the books of several of tbe Satellite shipyards ore expected to provide full employment Further, the USSR will continue to be the primary customer of European Satellite shipyards.














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Item 11

Satellite Naval

2ignificant anount of nuval shipbuilding has taken place in East German and Polish yards. In Haul Gcrany ships totalling Id excess0 tons standard displacement bare been produced for naval use. The Polish Navy has been provided with shipsotal displacementons by local yards; thc first six GRADUS Class AGU (each displacingons) have been, or are being, built for the Soviet Nuvy.

Most construction in both countries has been of amphibious types, auxiliaries, and oervicc croft. Only East Germany continues to experiment with patrol ship designs. It is expected that this same general pattern will continueI". Almost all East German naval construction took place at tbe Peenewerft at Volgast. Naval Construction in Poland was preponderantly at thc North Yard of Gdansk.

Shipyard No.


las :






rale WW



fl Standard displacementother-isc spc-Lifieij Hayach year

Contof Unitf

Peonevorft Peenewerft Feet


Navy Shipyard* Uortli Yard*


PurIkid North Yurd Unknown


Enst Genaany




unknown rrr.

Single nhip YDTICHSTAOflN ir.l



Total Tonnage' in-marks



Gdynia Odratk




f Slnndard-iir^placeaent unless, pt heyach year.

European Satellite Shipyard ftevicw

During the latter part23 most East German andattempted to lower the cost of production by the acquisitionequipment, the modification of some existing facilities, and by in the flew of materials Only at the Paris Cornet..

Shipyard in Gdynia has therev;jor addition to shipyard facilities.

In the past year the Stocznia Gdanska yard at Gdansk has built dry-cargo ships orlb0 scries tankers, and four classes or fishing ships. Although recent modification or facilities arc unknown at this time,0 zlotys were earmarked for investment in the yardutlotys planned for the9 Aboutercent of these funds, air-to go tward production facilities, and will probably result in the extension of some buildingew fabrication shop, newhops, and modernization of thc plate shop. The remainder will go for improvements to quays, warehouses, and grounds.

The Worth (Polnocna) Yard at Gdansk, adjacent to Stocznia Gdanska, has been building POLNOCNi-classnd CRADUS-class AGL's. No important changes in facilities are known to have taken place recently. illion zlotys will be invested in the yard

Tbe Paris Commune yard ut Gdynia has nearly completed its newfacilities, whichuilding dock of S m. Inside dimensionsarge assembly building. WT dry-cargorototypeew series, is under construction in the dock, and is scheduled for launching in3 at thc time work on the dock gateon bridge crone is due to be completed.

It appears that an unidentified now minesweeper is under construction at the yard.

In the past year the yard hasdry-cargo ships, and

3 series trawlers. The yard hopes to0 DWT0 DWT ore carriers% andVT tankers for export.



arski yard in Srctecln has constructed rive claoaes of dry-cargo ships, and one class each of refrigerated cargo and passenger cargo ships. press reportsavingons or in thc construction ofargo Ship ANDRZEJ STRUG,ossible design change in this series. The yard probably added in the poston press and several automatic plate cutters.

Kb at Germany

Thc Vurnov-werft In Warnemunde hos built in the past year Type Xships. Type IX and DZHANKOY-closs builk carriers, and one' Typeand general cargo-carrier with large hatch covers. It vasthe yard may slso have fitted out some TROPIK-claBs fishbuilt at silsun

No major changes In facilities have been noted, but the yard maya new plate de-rusting machine in operation. Studies ore reportedlyat thf yard on the use of plastic piping in maritime ships.

Thc Neptun Wcrft in Rostock has built four classes of dry-cargoranealvage ship,rain ferry. Significant new changes in facilities or in work methods are unknown.

The Volkswerft In Stralsund has continued production in tbe past year of TROPDC-class fish factory trawlers. hlplift installed2 is In operation for tbe building of these vessels.

The Mathlns Thesen Werft at Wismar has builtIKHAIL KALTNIN-clasB passenger ships. BHiTOLT BRTCHT-class fish factory trawlers, and one fishing research ship. In3 the yard launched0 GRT passenger ship IVAN FRAHCKO for the USSR, thc largest ship ever built in East Germany.

The yard reportedly hopes to install more modern equipaent and to develop more economic building techniques, especially the prefabricutlon of larger ship sections.

The Peenewerft In Wolgnst built NORIfiTKRN-class dry-cargo Ships, BHATSR class refrigerator ships, and several classes of small naval craft. The most important of tbe latter werelassnd oneloss LCT. No expansion of facilities are known to have taken place in the past year.

BlOC Imports of Maritime Ships From Western

. The gross reginter tonnage of Maritime ahlps conpleted3 is estimated to beonsecrease of aboutercent over that This decrease in completions Is believed to be due principally to the completion or existing contracts. Both in terms of tonnage and number of ships completed for the Bloc, Finland led other Western countries

3 some existing contracts for new ships were extendedcontracts were negotiated with dcliveriea of ships scheduled The most notable aspects of the new aarccments were theupon output fromand the considerably

increased emphasis upon fishing shipsof ships Tor the Blocre shown in the roilowing tabic by shipyard, name, and class.




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class t5 poland. josef conrad class to poisivi.

contract with the ussrrsrgo ships for deliveryco

contract with the cssr3 foraikers for delivery?rom split.)

Item !^ Pari. I

The Glowing Power of the

This Item re pre ttents en attempt to conblne past, present ond future production of maritime cargo ships and tankersRT, whether built In Sloe Western countriesohesive ship acquisition picture, and to determine the economic expenditures involved, for the Seven tear.

The DVT characteristics ofrgo and tanker fleet as of the end" the total Soviet ship acquisition progrum, and an aasumed attritionor each type ofs been combined toheoretical fleet size as of the end of the Seven Year Plan.

does not include refrigerator

ships, passenger ships, combination raescngcr-refrigerator ships, fishing ships, factory ships, or any ferry *vpe or miscellaneous ships, which would considerably expand the totalnd DWT of thc cargo fleet. Second hand ships are included for this year but ore not included foreriod. Host of the aforementioned whips are excluded because of the small limited use outside of the fishing fleet, or because of the small amount of DWT involved, and because theseare not considered Inew ship acquisition program.

" Tokenranslationoviet book entitled "USSR Seaoriginally edited. iakayi.. Bayev. (hakayev Is the present Minister of the Maritime Fleet) wherein it is stated that on thc basis of research by the Central Scientific Research Institute of the Maritime Fleet the service life of dry cargo ships has been fixed atears, and tunkcrsears. These figures huve been used for theoretical estiinjites. However, past practice by the USSR indicates that ulilps may be in use many years longer than the service life snd therefore would have thc effect of increasing the site of the fleet


Total He* Snip Acquisition

Only one goal was announced for the Seven Year Plan that can be related to an overall shipping effort: "the total tonnage' of the maritime fleet will double." This phase is typical of Soviet ambiguity in official plan pronouncements, nevertheless it may be taken at face value and usedeneral yardstick of accomplishment.

In thc seven yearhe USSR maritime fleet will receive from all sourcesew cargo ships and tankersillion2 million DWT) valued at more7 billion. These figures can be broken down intoargo shipsillion9 million WTJ and5 tankersillion GRT, 3 millionequiring an expenditure of9 billion for cargo ship construction and5 billion for tanker construction. Technically, not all or these ships will go to the maritime fleet Tor reasons such as useaval auxiliary, or relegation to the fishing fleet, ncves-the rens the expenditures must be made.

Of thc total number of new ships to be acquired by the USSRaboutercent will be cargo ships and aboutpercent

The percentage of number and value of ships to be received by the USSR from all sources is as follows:


By value



Assumed to mean UW'f.

Comparison of Bloc ond Kon-Bloc Construction Carpc. Sir. pe

Aa shown in thc above tabulation, Ol percent (by number)cargo sbipa tbe Soviet Union will acquireUlother bloc and non-bloc countries. Of this percentage,countries will contributeercent and non-blocercent. In terms of numbers and tonnage, thehipsillion3 otillion DWT) valued at The non-blocercent represents lC* ships ofhounand DWT) valued atillion. Total Sovietimportshipsillion1 millionat more5


In the tanker category,percent (by number) of the total to be acquired by the Soviet Unionill ccne as Imports -from other bloc and non-bloc countries. Of this percentage, non-bloc countries will deliverercent and other bloc countries onlyercent. In terms of numbers and tonnage, thc non-bloc percentage representsankershousand GRTillion DVT) valued otillion, and the other bloc countries percentage representsankers of ll8 thousand ORThousand DWT) volucd at about JSO million. Total Soviet import of tankers will amount tohipsillion6 million DVT) valued atillion.

Total Shipbuilding Efrort

Of the total ofhips to be built, the Soviet Union will buildships orf the total. This conatruction by the USSR will amount to about 3C# or thc tonnage and will require an outlay of0 millionf the total value of new ship acquisitions from all sources during the plan yaara.

Comparing total CRT to be delivered, the following tabulation shows that the Soviet Union will construct about the same amount or CRT as she will receive from other bloc countries, and that thf imports from non-bloc or western countries will exceed thin amount.

Cargo Ship Tanker


Bloc Built


according to GUT produced, the results are as follows:

Bloc USSR Poland K. Germany Hungary Bulgaria

Total Ships




Avg. GRT fer Ship

Percent of Total CRT



2 1


inland Italy Yugoslavia Denmark Netherlands U. Germany Sweden

; Hi 7





3 J3





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Reasons for Soviet Reliance on Western Shipbuilding

West JnC^^IT1Ccontinupdimport of ships builtVaricd' The blowing are considered

order of

t the West advantage of Western

countries competing with each other for contracts to help case the

an create an unemployment problem

at certain Western ahipyards by denying contracts.


JLScompete with thet


capacity or ability to produce many ship components, therefore the USSR

'TV, IOthe HeCtP^ict. In spite ofThis,nations (Poland and East Germany) are more or leas dependent upon the USSR for shipbuilding orders.

ntrJl' J" fffiard to the USSR it6clf-maritime shipbuilding

purposes, an the same boat as the Europeaness efficient

tSTtS' and toe3 reluctance to produce

the high horsepower marine diesel engines required in modernpropulsion, although there is some evidence that, thisis now being

enn'i the reccnthas devoted and will

continue toignificant portion of its total shipyard facilities

trUCtIOn ofthis sector of thfshipbuilding

friclent' Presumably produce propulsion equip-

PurchL-IMPSa lrdScatedher continued

second-hand ships, ship chartering activities, and new ship

IZl UiCh the While Soviet demand for ships remains

h" total tonnage of tne

Soviet merchant Heel. wUl beimes0 level) ship-

xpftctcd t0 Utein Western

Si eg and Composition of thceet

At the end8t is estimated tliat tbe Soviet cargo and tanker fleet consisted ofhipsillion rVT. Of thishipsillion IWT were cargo ships andhipshousand DWT were lankern. By thc end5 it is estimated that the cargo fleet will increasehipsillion DWT, an Increase in IWT ofs- The tanker fleet by the end5 will consist7 shipsillion DfT, an increase in DWT ofercent The combined cargo and tanker fleet, by the end5 willhipsillion DWT, an increuoe in IWT of llOj, thus indicating fulfillment of the Seven Year Plan target of "doubling the tonnage of the maritime fleet.

The average IWT of cargo ships8 wasons and by the end5 will have increased toons, an increase or The average IWT oP" tankers& "asons and by the end5 will hive increased5 tons, an increase ofJ The increases ln average DWT or cargo shlpr. ami tankers by the endirect result of t. larger ships to be added to the maritime fleet^uringand this increase

in uveragc IWT for cargo ships and tankers will nanirest itself in

increased cargo carrying capacity. Thc graphs show the RVTr the cargo and tanker fleet8 Including new ship

acquisition and attrition,reakdown of numbers of

ships ln Individual :wr range grouped ln thousands.

The makeup of tho cargo and tanker fleet will also be changederiod as compared As regards cargo ships, the greatest growth in numbers of ships will be inWT range. This group^ consisted' shipsillion DWT but by the end5 will consist ol 5C* shipsillionet Increasehipshousand IWT. All groups withinUT range will expand except one,WT group Wo shipsVT will be built during the- In the WT groupof the ships will be new ships.

* In this period thc average DWT of new cargo snips and tankers to be added

to the maritime fleetonsona, respectively.

- Hi -

In0 IWT ronge8 cargo fleet size wot; A9 shipshem and DWT. By the end5 the total will behip*housandet decrease or l6 ships of 1ft thousand IWT. InWT group all ships will be new ships; loWT group there will be an increase of0 DWT, and in this group so re thanwill be new ships. 0 DWT group, as In the case ofWT group apparently is expendable and no ships0 IWT will be built-

InWT rangeB cargo fleet Size was onlyhipsWT. Nearly all of these ships were congregated lnWT group. By the end5 the total will consisthipsillion DWT and tbe overwbelaing majority of these will be of new construction. WT group will be drastically reduced by the endut tbe greatest-Increases will be laWThipshousand OUT) and InWT0 shipshousand DWT. All Of these ships will be of new construction and are the most popular size ships.

Thc overall net increase58 of nil cargo ships willhips totaling illion DWT. By numbers of ships, aboutof5 cargowill be less thanears old, and byr this fleet will be less thanears of age.

In tbe case of tankers the greatest growth in nunbers of ships will be InWT range. This group8 consisted ofhips totaling abouthousand DWT but by tbe end5 will consist ofhips ofhousandet increase othips' thousand EtfT. These ships constitute the bulk of0 IWT range. No ships will be built in0 IWT range.

InWT range will be found the largest number or tankers and resultant tonnage Cor one single DWT range at the endeflection of Kazbek class constructionankers ofhousand DWT.

hip0 or more DWT existed In the Soviet tanker fleethe end5 there will behips ofr more DWTillion DWT, or aboutf thr* tanker rieet.

TOP secret-

Item Hi)

The overall net locrease58 of all tankers willhipsillion DWT. Of this net increasehips will be inWT raneehousand DWT orf the net increose In DWT;hips will be inWT range0 DWT orf the net increase in DWT. Seven tankers InWT rangeankers inWT range will each consist off the overall net Increase.

By numbers or ships,f5 tanker fleet will be Jess thanears old, end by DWTf this fleet will be less thanears of age.



Probably the weakest link inThe Soviet maritime shipbuilding structure is the design Cend production of high horsepower. marine engines. However, there appears to be no need for thc Soviets to develop native marine diesela when efficient, reliable, and perfected foreign engines can be produced In the USSR under license. Inew classes of Soviet-cargo ships that first appearedbe POLTAVA and the VTThGHALES, were equipped with marine dlesel propulsion units built at the Bryansk Machine Dullding Plant under license of the Danish firm Burmcister and Wain. The POLTAVAp engine and the VYTEGRALRSp engine. Ir.3 It was reported that the Bryansk plant was0 hp dienal engine (for eventual series production) which again probably is done under license. This engine may be for tb= PEREKC-pcargo ship.

Steam Turbine

Only one claes or cargo ships, the LENISSKrY KOMSOMOL, is constructed In the USSR with steam turbine propulsion, and no cargo ships are being built in bloc or non-bloc countries for the USSll with steam turbine propulsion. On the other hand, large tankers buildingn the USSR, the PEKIN nnd SOP HA claanes, have steam turbine propulaion.

Gag Turbine

Gas turbine propulsion la the newest Innovation in marine propulsion systems but has hud little application up to the present in Soviet Maritime shipbuilding. The only class of maritime ship built in

the USSR with gas turbine propulsion is the PAVXIR VINOGRADOV timber carrier. However, while the ship itself is built In Leningrad theturbine porpulslon units are produced in Prance and exported to the Sovie' Union.

A native Soviet gas turbine known as CTU-PO was mentioned in tlic pressfew years ago as tha propulsion unitew tanker. It now seems that0 hp gas turbine unit will go into the LKNINSKIY, class cargo ship us latest reportsas turbine variant of thin class ship will be produced prior to the end of the Seven Year Plan.

Nuclear ITopulslon

Little Information is available In the nuclear propulsion field concerning maritime shipbuilding activates or plans except for vogue general statements. It baa been reported that another nuclear powered Icebreaker larger than thc Lenin is ln the planning stage, and that there were planeuclear powered tanker which have been cancelled. Inoviet radio broadcast stated that in the nexthc USSR maritime fleet woulderies of fast atomic powered cargo ships. This broadcast also stated that many difficulties would have to be overcome before tbe Soviet Unioneally economic, compact, lightweight atonic power unit.

In the Soviet Union as In other countries of tbe world it is believed that nuclear ships are still too expensive to construct and too costly to

maintain, except as in the case of the LENIN and tbe SAVANNAH as prestige items. No nuclear propelled ships will be delivered to the maritime

(cargo und tanker) fleet during theear.


The variety of different types or ship propulsion added to the Soviet maritime rieet, may eventually result In complicoted repair and overhaul problems, as indeed the growth of the fleet itself will compound these repair and overhaul problems. The USSR nay be forced to improve, expand, or construct ship repair yard* or to "farm out" ship repair work lo Western shipyardsrocess which generally hfis been avoided by ihe Soviets in recent yearn for economic reaspona, political reasons, or both.

The Impact of the Growing Soviet Bloc. Introduction

A yearOfficethc

ta in

subject of the Patterns and Prospects of Sino-Sovlet Bloc Mercnantthe prospective strength of the Bloc merchant fleiv*.

future years and their capability eventually to cause losses to thediscussed the relative growth rates of the Bloc fleets

and of Sloe trade ond the inrpl lent ionsivergency in these twowould have on the world shipping lnduo*jry in the future. Thesefactors will determine thc amount of additional shipping businessBloc will be civlng to the Pree World fleets (or taking from them) infleets grew Impressively

during the past ycur. Bloc trade has also grown Impressively.

In the light of developments in the post few years we would like to review the situation and trends in world shipping and examine tbe progress that tbe

Bloc is making lo the development of both its fleet and trade to see if tbe tentative conclusions which we reached last year could still be considered valid

We can profit by beginningiscussion of the world shipping situation.

World Shipping Situation

A large part of the world fleet is owned or controlled on very long term contract by oil companies, steel companies, and the like, and this shipping does not actively compete in the world market. The remainder of thc world fleet Is for hire and can(be divided into two categories of shipping servicesliner services and tramp services. Ships in the liner service arc common carriers, providing pre-scheduled services for shipment of goods ln less than nhlpload amounts from any ond all shippers- The shipowners engaged in the liner trades nend their ships along their accustomed trade routes, stopping, at establishedn accordanceublished time schedule. Their agents at ports-of-call book space for export cargoes. Liner service, like railroad service, has the characteristicsatural monopoly. Unrestricted (cut-throat) price competitiond to Irregularity of service, badly dintributed sailings, superannuated und badly maintained veasels-

The need for sufficient Monopoly control of the freight rate structure to provide reliable, regularly scheduled high-quality common carrier service for shippers is universally recognized. Since it Is an International business and cannot be regulated by national governments It has become, because of the nuturn! interests of the shipowners, self-regulatedystem of curtfls, called conferences- The conference, which is established for each of thc trade routes, sets the freight rates for that route, and in its own interest It does not set them so high that It would profit any member of the conference to withdraw from thc certel and cut th-rate.

In tramp service, the hire, or charter, of entire ships for one or more voyages In accompliahed through ship and cargo brokers. The market La free andot of higgling is done, the rates are ultimately determined by demand and supplydemand for ahips to move given cargoes at given times between given chipping areas of origin and destination, and the supply of ships of the desired Sixe thai" are available at the required time and place. Thc market is extremely sensitive and freight rates fluctuate sharply under the Impetus of prospects for much or little cargo. Witness thc upward pressure on rotes of the recent orders for Cnnadian wheat which were placed by thc USSU. The market hacjilso long-run tendencies which are the reflult of the long-run relationship between the totnl amount of available world tramp tonnage und the total amount of world bulk enrgocB-

the world shipping industry has beenepressed state since thc Suet crisisash of shipbuilding. World seaborne trade bus not increased rapidly enough6 to offset the added tonnage and increased efficiency of the new-builds. Although fluctuations have occurred in various trades at various times, the long-term trend in world charter rates in the tramp and tanker markets generally lias not yet recovered to even3 position. In the meantime, of course, port, cargo handling and crew costs are rising, making it all the store difficult for the marginal shipowners to stay in business.

The liner conferencesertain amount of control over freight charges and port surcharges in the scheduled liner services, although they do not control the volume of goods moving on tbe trade routes or the number ofgoged In comp-tini* for it. In tramp and tanker services the market has been unfettered and keen competition amongbecause of the redundancy of ships, has established freight rates so low that the marginal operators cannot alvays cover fixed costs and sometimes not even their variable coats. In an effort to raise tramp and

tanker freight rates under conditions of excess tonnage, schemes for the control of the effective supply of ships on thc shipping market have been worked out and are now being placed in effect by both thc dry cargo tramp owners: and tbe independent tanker owners. These are known as tonnage stabilization schemes and simply require thc participants to pay charges, based on their total active tonnage.und to be used to subsidize participants toertain amount of tonnage laid up. The coat of subsidizing themselves to keep their redundant tannage off the market is to be covered by tbe additional revenues to be realized from the expected increase In freight rates. It is important to keep in mind that thc nice balance between tbe amount of world trade and the size of the world fleet, which is necessary to maintain freight ratesormally profitable level, can be upset by relatively small uncompensated Increases in the size of the fleet or in the amount of trade. Currently we have an illustration. The Impact ofij.the -recent Soviet orders for whent from North America and Australia, which are an absolutely new increment to world trade and which are to be curried outery short period ofaised freight rates in the grain trades byercent during the month of September and generally raised all tramping freight rates including the cost of no* time charters.

The difficulty ofalance between world ship tonnage and world trade cargoes, as seen from the shipowners viewpoint, is constantly aggravated by the efforts of the shipbuilders to stay in business. It is amusing to see bow the trade Journals that represent both shipowners and builders struggle with their editorial policies. It has been estimated that the world (shipbuilding plant can currently completely replace the world fleet every ten years; but ships have an average useful life ofears. Building ships for the Bloc isolution acceptable to the Free World shipowners, ns we shall, now sec.

The Carriage of the Bloc's Foreign Ocean Trade

ecisive number of the Free World's tramp owneru and independent tanker owners are ableime to support higher freight rates only by the expedient of artlfically stabilizing the supply of world tonnage, what effect will the ship acquisition and foreign trade programs of thc Bloc countries have on their (Free World) program to improve earnings? We can start this discussion by acknowledging that an important amount of tbe Free World ocean freight business consists of carrying the export-import trade of the Sino-Soviet Bloc on Slno-Sovlel account. Free World ships also carry Sino-Soviet foreign trade on tbe account of the trading partners of the Sino-Soviet Bloc. But It Is the former tradehat

controlled by thc Sino-Soviet Blocor which the Bloc determinesloe shiphip chartered fromFree World shall be employed. The transportation of Bloc foreign trade is preponderantly controlled by the Bloc Side Of the international transactions by the simple strategem of making itsountry of origin, and itsountry of destination. hipping agreement could modify the degrees of control over thc movement of the goods which the conditions of the sale would give each of thc trading partners.

By controlling the transportation of as nueh of their trade as they can, the Bloc countries ensure full employment for their merchant shipping and are able to regard that amount of trade that they control, and for which they now charter Free World shipping, as potential business for an increased fleet. Whether this is the main reason for controlling the movement of so much of their own trade at this time oron't know, but itactor stimulating to the growth of the Bloc fleets and so wc must be conscious of It.

The Bloc countries (with the exception currently of Communist China) are striving to reduce their dependence on Free World shipping by building up their own merchant fleets- In thls-they have nade remrkable progress in the last few years and their plans forecast equally remarkable progress in the future. So far, the level of world freight rates has not been affected by the Increasing of tbe Bloc fleetsarallel increase ln Bloc ocean trade has taken place. We oust look ahead and compare the estimated future Increases in Bloc fleets with thc estimated future increases in Bloc trade to sec thc possible impact on Free World shipping. Because of the control the Bloc has over tbe movement of its foreign trade, it has the ability to keep its own ships employed while the growth of its fleets adds to the general redundancy of world shipping.

: The Effects of World Shipping of thc Seif-Sufflclency of the Soviet Bloc Merchant Marine

hows the anticipated growth in the world active fleet and ln the Bloc fleet. It can be seen that thc Bloc fleet is to grow rapidlyot just absolutely but alsoercentage share of the world fleet. Whereas05 it amounted toercent of the world fleet, it roseercent,0 and is expected to amountercentercent0 andercent

he Merchant fleets of the Bloc countriesittle lessercent of their own seaborne foreign trade (seeomparison of the grouth rates of the Dloc fleets and of aggregate Bloc foreign trade indicates that5 they will be carrying nearlyercentuch larger foreign trade- Thus, despite the growth in the Bloc fleets,5 Free World shipping will still be carrying aboutillion tons of Bloc foreign trade cargoes compared withillion But Bloc, shipping will be carrying aboutillion tons5 compared with5 million tons Thus in thet should be noted that the foreign trade of the Bloc is Gjill growing faster than the carrying capacity of its merchant fleets.

Before proceeding further with the analysis we should note that there is an upper limit to the percentage snare of their seaborne foreign trade for which Bloc countries can controltransportation. As mentionedumber of Free World trading partners will insist that trade agreements provide the right to carry half of the cargo that is exchanged. They include, particularly, the less developed countries that are building national fleets for prestige purposes or in order to conserve foreign exchange. Further, it is not always possible for thc Bloc to. and. In that recent and revealing book of the Ministry of the Maritisx? Fleet entitled "Transport USSR, Volume IT, Oceann opinion is given that thc Soviet merchant fleet can hope to carry as much as three-fourths of thc nation'sseaborne foreign trade. Accordingly, we will acceptercent as the upper limit for the Bloc in this respect-

At some point of time50 the rapidly growing Bloc fleets will be able to carry all of tin- seaborne foreign trade for which they will be able to control the transportation, and will no longer be dependent on tonnage chartered from the Free World. Thereafter, the Bloc fleets, by growing more rapidly than their aggregate seaborne foreign trade, would have excess tonnage with which ton the tramp and liner markets of the world. 'such excess tonnage is likely to amount loillion IWT and5 toillion IWT. The latter amount would exceed the size of the Bloc fleet0 and be equal tol of today's world tramp fleet.

This excess Bloc tonnage, notischarge Bloc foreign trade transportation responsibilities, would enable the iiloc to establish scheduled liner service on the world's important trade routes, toespected economic presence felt in thehe developing countries, and to set rates in the liner and tranp parkci? of the world. Under sash

onnage stabilization schemes would tend to lay up Free World shipping only to make way for Bloc shipping in the tramp market, and the Bloc would reap the benefits of the supported price. In liner service, Bloc shipping could undercut the freight rates of the conferences on selected routes and be assured of good loadings. Another glance atill reassure us that the Bloc cannot take all tbe seaborne freight business away from Free Uorld shippings. But it can, if it so desires, make the ocean shipping business unprofitable for many tramp and liner operators, and disrupt established ocean shipping patterns. There la no question that the Soviet Ministry of the Maritime Fleet harbors ji desire to have this power. The Soviet book "Oceanentioned earlier, refers to tbe expectation that tbe merchant fleet will "exert an active influence on the worlda decisive influence on the level of world freightnd willole in "the freight carrying operations of foreign shippers"- Moreover, it is one of the declared alms of CKMA to make Bloc shipping Independent of fluctuations in the world shipping market.

This discussion has been generalised and the analysis has been Estimates of future world fleet size are based on extrapolations from recent data. Estimates of future Jlloc trade andze are based on Bloc plans, and the plans of the Bloc are only their own extrapolation!'The data are estimated, but the trends seem clear. Bloc shipping is already engaged in liner service and is likely to compete strongly in that service even before the Bloc Is independent of the need to charter Free World tramp tonnage. Nor isoregone conclusion that Bloc shipping will engage in ruinous competitionarge number of liner conferences; its shipping companies are likely to Join some of the conferences when it is expedient to do so.

Inhealth of international

shipping depends on the balance that exists between the aggregateof cargoes and of ships on the world shipping market. TheBloc activity is only one of many other effects on the market In Following the Suezapid rise in new-builds withoutincrease in cargoes forced freight rates down and createdIn the shipping industry. In the period0 andgrowth In Bloc seaborne foreign trade has exceededcontinue to exceed thc growth in thc carrying capacity of Itsisuoyant effect on the world shipping market. Becausecopacity, the shipyards of the world can build ships moreworld trade can use them. Orders for ships are gratefullyBloc countries by the shipyards of the Free World and are contributing

in signiritant measure to thc growth of thc Bloc fleets- Such orders help maintain employment in the world shipbuilding industry but add to the general world redundancy or ships.

The Bloc is primarily concerned with achieving freedom rrom dependence on Pree World shipping. At some time (we thinshe Bloc countries may have sufficient shipping to carry the share (we accept aboutercent) of their seaborne foreign trade, for thc transportation of which they hope to be responsible, and their surplus tonnage will be competing for the tramp and liner bus!neon of third countries. The Bloc countries will want to compete in the International shipping market in order lo show their flags in the port* of the world and in order to earn foreign exchange. 0he fleets of the Bloc are expected to growercent to aboutercent of the world fleet.

Thc Bloc can use its ships to attest selected liner conferences in rate wars, but If it is tourveyor of ship tonnage, it is not likely to want world freight rates generally depressed to uneconomic levels. Bloc shipping costs, and, if world freight rates are too low, participation ln the world shipping market would notood means for tbe Bloc to earn foreign exchange. Thc export of some other service or commodity might ofrer greater returns.




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Original document.

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