Economic Intelligence Memorandum
SINO-SOVIET BLOC CONSTRUCTION AND TRADE IN NEW DRY CARGO SHIPS AND TANKERS
CENTRAL INTELLIGENCE AGENCY Office of Research and Reports
'A HISTORICAL REVIEW PRGURAM RELEASE IN8
Economic Intelligence Memorandum
SINO-SOVIET BLOC CONSTRUCTION AND TRADE IN NEW DRY CARGO SHIPS AND TANKERS
CIA/RR
later lal containyInformation afle&niig (allonal Defeiwar of Uic United States the meaning/of the espionage'SC.. the' trans-or revelation ol which Inn unauthorised/person is prohibited by law.
CENTRAL INTELLIGENCE AGENCY Office of Research and Reports
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FOREWORD
Soviet plans coll for the doubling of the total tonnage ofceangoing maritime fleet of the USSR during the Seven Year. These plans are evaluoted in this memorandum which supplements the data on construction shown inRAstimated Dumber, Value, and Distribution of Merchant. Ships Constructed"byor the Glno-Soviet,ECRET, and the data on the growth and operation of the Sino-Soviet Bloc merchant fleet shown in CIA/RR, Annual Brrtcw of Merchant Shipping in the Slno-SovietUECRET. In addition, this memorandum shows the value of the construction and acquisition of all categories of merchant ships, with particular reference to theand acquisition of oceangoing dry cargo ships and tankers.
The detailed nature of the information contained in this memorandum involves numerous source references for each of many estimates and make the inclusion of source references lnfeasible, but source documentation for estimates io avollablc in the files of this Office.
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COWXHTS
o'unimry
I. Introduction
II. Construction, Imports, and Exports of Nev Dry. ,
Independence of Non-Bloc Countries for
Main Propulsion Engines of Ships
III. Construction and Imports of Tankers
A. Bloc Construction
ti. Bloc Imports
Statistical Tables
Tables
1. Value of Construction, Imports, and Exports of HeulyMerchant Ships by tho Sino-Soviet0 *
of Newly Constructed Merchant Ships Imported from
Non-Bloc Countries by the Sino-Soviet0
Imports, Exports, and Value of Newly Con-
structed Oceangoing Dry Cargo Ships of More
Gross Register Tons by the Sino-Soviet0 .
SINO-SOVIET HIOG CONSTRUCTION AND TRADE
IN NEW DRY CARGO SHIPS AND TA'iKERS*
hange in priorities, the USSR is expected to achieve its goal or approximately doubling the tonnage of the maritime fleet during the Seven Year. As the accompanying chart shows, of the total value8f theonstruction and net trade ln new merchant ships'ore than one-half,0 million, consisted of maritime ships:
Wotarwoy ihipi
Ma rilim* Ship.
QbO US
0 > 9 0
GAIN
ifw miaH tho?*
* The estimates In thi3 memorandum represent the best Judgment of this Office as
** In this memorandum, dollar values are given0 US In this memorandum the term Bloc refers to the Sino-Soviet Bloc.
r in this memorandum the term merchant ships Includes all categories of maritime, fishing, and inland waterway ships.
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Eft' rj.y*
or0 net Bloc gain6 Billion,million, orpercent, represent Soviet construction and imports. Off maritime shipsboutercent vas made up ofships and tankers of moreross register tonsshown in the following
HewS $
Maritime
Dry cargo ships of more
Tankers of sore than
Total Bloc
Construction and imports (less exports) of new dry cargo ships of moreRT, excluding those assigned to Caspian Sea service, resultedet gain to the Bloc0 ofhipseadweight tonsnd valued atmillion.
Gross register tonnageeasure whereby the entire internal cubic capacityhip is expressed in register0 cubic feet per ton). Not Included in the measurement are certain spaces such ao peak tanks and other tanks of water ballast, open forecastle, bridge and poop, hatchway excess, certain light and air spaces, anchor gear, steering gear, wheelhouse, galley, cobins for passengers, and other minor spaces specified by law.
ncluding tugs, icebreakers, auxiliaries, and small dry cargo ships and tankera of lessRT.
*** reakdown of construction, imports, and exports, seen the Appendix, pp.espectively, below.
t xhe deadweight tonnagehip is the carrying capacity of the ohip in tons ofpounds. It includes the crew and their effects and all items of consumable or variable load ouch asuel, and cargo. The deadweight tonnage is the difference In tons between full load displacement and light ship displacement.
UMVl
On the basis of tbe rate of construction of dry cargo ships0 andlight Increase in productivity, the Bloc easily can construct5 Billion DWT during tne Seven Year Plan. Moreover, during the same period lt Is believed that laports willexports byll Hon DWT.
The construction and imports of tankers (no tankers were exported) of moreRT, excluding tankers assigned to Caspian Sea service, resultedain of l6 tankersWT and valuedillion. During tbe Seven Year Plan, Bloc construction of tankers may reachtotal ofankersillion DWT. Trade agreements, construction contracts, and negotiated purchases withountries during the Seven Year Plan probably will amount toankers* million DWT. Bloc construction and imports of tankers during the Seven Year Plan could amount toankersillion DWT.
* In this memorandum the term non-Bloc refers to countries outside the Sino-Soviet Bloc and includes Yugoslavia.
T-'r
I. Introduction
Total construction and net trade In nev nerchant ships ln the Sino-Soviet Bloc0 amounted8ain ofercent above the level Of0 total,0 million, consisted of maritime ships. Aboutercent of the value of these ships vas made up of dry cargo ships and tankers of moreRT.*
Unless the resources currently allocated to the construction and procurement of new dry cargo ships and tankera are shifted elsewhere, it Is therefore estimated that the USSR will attain the goal ofdoubling the total tonnage of the oceangoing maritime fleet during the Seven Year Plan. This memorandum Is therefore focused on the Bloc program to construct and import new dry cargo ships and tankers.
II. Construction, Imports, and Exports of new Dry Cargo Ships"
A. Bloc Construction
0 the Bloc producedry cargo shipsWT and valued1 million. The rate of construction of dry cargo ships by the Bloc0 io one that has been reached by steady annual increase There are no indications that this rate of construction has been accelerated by special priorities, and lt probably can be maintained if not slightly Increased during the remaining years of the Seven Year Plan.
In th* construction of dry cargo ships of moreRT by the Blocoland led with productionast Germany was second with productionnd the USSR was third with production0 DWThips). Four other Bloc countries produced dry cargo ships0hips).
See p. 2,
** Seen the Appendix,elow. Tfcblend the data used ln this section arc restricted to oceangoing dry cargo ships of moreRT and exclude all ships assigned to Caspian Sea service and all refrigerated cargo ships except the two Imported from West Germany. all refrigerated cargo ships, except as noted above, are assigned to servicing the fishing fleet, they are excluded froa consideration ln this section. Because some ships are converted after eonpletion and deliveryhipyard to naval auxiliary and other services, the number of ships and tonnage given in Tableherefore, do not necessarily constitute additions to the maritime dry cargo fleet of the Bloc.
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On the basis of the rate of construction of dry cargo ships0 endlight increase in productivity, the Bloc easily con construct5 million DWT during the Seven Year Plan.
Imports
0 the Bloc Imported from non-Bloc countriesry cargo ships,WT and valued at $J9 million. Included In the imports from non-Bloc countries were two refrigerated cargo ships built by West Germany for the USSR. Each of these ships, to be used in Blockfrica trade, has four Insulated cargo holds capable of carrying chilled fruits and frozen produce. Other refrigerated ships that have been domestically built or imported by the USSB have been used only in the transportation of chilled and frozen fish from the Soviet fishing grounds to the homeland of the USSR.
Firm contracts and trade agreements between Bloc and oon-Bloc countries show that the import of dry cargo ships win continuethe Seven Year Plan period.
Exports
0 the Bloc exported to non-Bloc countriesry cargo ships0 DWT and valuedillion. Although it isthat the Bloc will continue tomall number of ships, it Is believed tbat the amount of imports will exceed exports byillion DWT during the Seven Year Plan period.
K. Bloc Independence of Hon-Bloc Countries for Main Propulsion Engines of Ships'
ew years the Bloc should virtually be independent of non-Bloc countries for the supply of propulsion engines. The USSR, Poland, and East Germany for several years have held licenses to produce large diesel engines of designs by Burmeister aod Wain, Sulzer, and Maschinenfabrlk Augsburg-Rurnberg. The first Soviet version oforsepower (hp) Burmeister and Wain diesel engine will be-in-stalledew class of cargoWT) scheduled forin the Hosenko Shipyard in Nlkolayev. Recent developments indicatehp goo-turbine engine is at an advanced stage of construction and probably will be installed in theDWT tanker soon to be built in Leningrad. Since the reduction5 of the construction of large naval surface ships, the USSR has had ample capacity for the construction of steam turbines for merchant ships.
III. Construction and Inporta of Tankers* A. Bloc Construction
0 the Bloc producedankers totalingand valuedillion comparedWT of dry 9 the BlocankersIs estimated that1 the Bloc will constructankero
Production0lasses of tankers: the ChienWT),f which was constructed by Communist China;f which were constructed by the USSR- and theflOf which were constructed by the USSR.
The Kazbek class continues toavorite in the USSR. By the end6 tankers of this class had been constructed. The coat of transporting oil in this class of tankers certainly io higher per ton than that in larger tankers, but the advantage of the relatively ohallow draft Kazbekeet) in comparison with that of the Peklnermits entry in most harbors of the USSR. ekin-claoa tanker ot full-load draft, for example, cannot enter the port of Leningrad Although the annual rate of conotruction of the Kazbek class has recently decreased, there is no evidence nt thio time that indicates the number or Kazbek-class or Pekin-claso tankers yet to be built. Tankers smaller than thottazbek class, particularly inWT classes, are used principally for the domestic transportation of oil. Tankero larger than the Kazbek class are used principally ln the transportation of oil from the Black Sea to the Bloc For East ond in exporting oil to non-Bloc countrieo.
The Soviet press has carried articles referring to the planned conotruction of two new classes, oneargo capacity of0 tono and the otherargo capacity of0 tona. Conotruction ofton tankor may be underway, but it lo doubtful that the construction ofton tanker will'-begin beforer
The constructionarge class ofWT) recently began in Poland. The first tanker of this class will be named Bausk
Seen the Appendix,elow. nd the data uoed in thlo oection ore restricted to oceangoing tankers of moreRT and exclude all tankers assigned to the Coepian Sea service.
(formerly Professor Huber) and will be delivered to tbe USSR ln the third quarterI. Two other tankers have been launched, one of which will be completed late1 and the other earlyoth are to be delivered when completed to the USSR. Two more tankers of thla class are scheduled for completion23 and are to be delivered to Ccaaaunist China. Six smaller tankersWT each are scheduled to be completed for the USSR12 by Poland. ew class ofWT) ls reported scheduled for construction in Poland beginning This tanker probably will be delivered to the USSR.
Should the nnmmi rate of construction in the Bloce maintained at aboutankersWT Bloc construction during the Seven Tear Plan mayotal ofankersillion DWT.
B. c Imports*
The rise in the emphasis by the USSR on exporting oil to non-Bloc countries has caused recent increased activity in the procuring of tankers. This activity has been particularly apparent ln theof tankers from non-Bloc countries0 and in thefor the construction of tankers.
9 the Bloc acquired seven tankersWT from non-Bloc countries. All these tankers vere produced on directcontracts between Bloc and non-Bloc countries. the Bloc acquired seven tankers totalingWT and valued at million. Four of these tankersO0 DWT were produced on direct construction contracts, whereas three tankersWT were procured through negotiations during the final stages of construction for the purchase of tankers already under construction.
Certain non-Bloc countries that engage in the transportation of oil had placed contracts with Japan and several countries .of Western Europe for the construction of large tankers to be delivered Becauseharp reduction in the demand for new tanker tonnage in those non-Bloc countries, the tankers being built under construction contracts became available for sale. The Bloc seized this opportunity andumber of tankers In various stages of completion, some of which had not yet been laid down on the shipbuilding ways. In spite of this situation, the Bloc has paid higher than world market prices forankers.
" Ho tankers arc being exported by the Bloc.
M
l, it io estimated that the Bloc will acquire aboutankersWT.* Seven of these tankers0 DWT uere contracted for before the recent Soviet drive totankers. In addition to theankers mentionedankers0 DWT are in progress.
, tradend firm contracts willaboutankersWT.* Negotiations also are in progress for two tankers0 DWT.
The number of tankers already under construction tbat may be obtained by the USSR through negotiations with either the shipbuilder or the owner is believed to be decreasing rapidly. In the group of tankers to be delivered, only one contract for theof two tankers2 vas obtained in this manner.
Total construction of tankers by the Bloc and acquisitions of newly built tankers from non-Bloc countries during the Seven Year Plan may amount toankersillion DWT.
* Seen the Appendix,elow. ** Trade agreements that include tankers are generally considered to mean permissive construction ratherirm contract. However, in the light of the current Soviet effort to procure tankers, it is believed that firm contracta will result.
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Table 2
Value of Ncvly Constructed Merchant Ships Imported from Hon-Bloc Countrlea by the Sino-Soviet Bloc
I960
0 US $
Country and Category
Denmark
Maritime
Pinland
Maritime Inland
Subtotal
Italy
Maritime
Maritime Netherlands
Maritime West Germany
Maritime Yugoslavia
Maritime
Total by category
Maritime Inland
Grand total
1.1
2=6
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scute
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tig
ft
fe K
aa iB&i
Table L
Construction, Imports, and Value of Newly Constructed Oceangoing Tankers of Moreross Register Tons by the 3ino-9ovlet Bloc0
Igportfl
Hon-3locGala
Register Tom
r
Tons
Register Toes
5/
:_ lp_a
Toes
Register Tons
bj
*
sblpa assigned to Caspian Sea service. No tankers vere exported Fn-iHTnrrhlr" srr rnmrrrtu iftsraad deliveryhipyard to naval auxiliary and otaer services, the nuaber of ships and tonnage stove lu this table doconstitute additions to tbe aarjtiaa tanker fleet of the Bloc.
S $.
Toole 5
Estimated Construction of Tankers by Non-Bloc Countries for the Sino-Sovietl
Country of Origin
of Tankero
Tons
of Tankers
Tons
COO
4
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Original document.
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