Foreign Relations of the United States, 1951, Korea and China, Volume VII, Part 2

S/S Files: Lot 63 D 351: NSC 104 Series

Memorandum by the Acting Secretary of State to the Executive Secretary of the National Security Council (Lay)¹

[Extracts]²

secret

Washington, September 21, 1951.

Subject: Second Progress Report on NSC 104/2, “U.S. Policies and Programs in the Economic Field Which May Affect the War Potential of the Soviet Bloc”

NSC 104/2 was approved as Governmental policy on April 12, 1951. It is requested that this Progress Report (covering the quarter ended August 15, 1951) be circulated to the members of the Council for their information.

Export Controls

1. Prohibition of all Exports to Communist China, Manchuria and North Korea

Since the submission of the first progress report, a general license designated G/PUB has authorized exportation to all destinations except North Korea, of the following publications, provided the publications do not contain technical data:

Motion picture films, developed

Books, bound, text, educational

Bibles and testaments

Books, bound, other

Books, unbound, in sheets

Catalogs and pamphlets

Music in books and sheets

Newspapers, current

Periodicals, current

Calendars, printed or unprinted

2. Export Licensing of all United States Shipments to the USSR and Eastern European Satellites

The only new development in licensing shipments to the European Soviet bloc concerns technical data. A validated export license shall be required for the exportation, directly or indirectly, of technical data to Subgroup A destinations.

a. The Office of International Trade, Department of Commerce shall deny export license applications for the export of technical data to Communist China and North Korea.

b. The Office of International Trade shall deny to all other Subgroup A destinations applications received to export technical data which, in its opinion, would be of assistance to these countries,

(1) in the production of commodities contained on the United States Security Lists I, IA, II and IIB; or

(2) in significantly maintaining or expanding the short term or long term war potential of these countries through the production of commodities or facilities other than those included under (1), or through contributions to industrial or theoretical research; or

(3) in providing information of intelligence value, such as that included in maps or plant location and layout descriptions.

. . . . . . . . . . . . . .

9. International Controls on Exports to Communist China

On May 18, 1951 the General Assembly of the United Nations adopted a resolution recommending that every State (both Members and non-Members of the United Nations) apply an embargo on the shipment to Communist China and North Korea of arms, ammunition and implements of war, atomic energy materials, petroleum, transportation materials of strategic value, and items useful in the production of arms, ammunition, and implements of war. The Additional Measures Committee was requested by the resolution to report to the General Assembly on the general effectiveness of the embargo and the desirability of continuing, extending or relaxing it.

As of the date of this progress report, sixty countries had submitted reports or acknowledgments. Of these, forty-two are generally satisfactory. This category includes the principal Allies of the United States as well as China’s principal non-Communist foreign sources of supply.

Consideration has been given in the United States Government to the status of the strategic embargo in the event of a cease fire or an armistice in Korea, and, alternatively, to measures to increase the effectiveness of the embargo and extend its scope if the Kaesong talks break down.

. . . . . . . . . . . . . .

James E. Webb

1. In NSC Action No. 582, taken by the National Security Council at its 107th meeting, November 28, 1951, the Council noted this progress report. As part of the same Action the Council noted a statement by Adm. E. T. Wooldridge, JCS member of the Senior NSC Staff, that the Department of Defense remained seriously concerned over the continued shipments of strategic materials into Communist China. The Secretary of Commerce, the Acting Economic Cooperation Administrator, and the Chairman of the Export-Import Bank participated in this Action with the Council, the Acting Secretary of the Treasury, and the Director of Defense Mobilization. (S/S Files: Lot 62 D 1: NSC Actions)
2. Extracted here are only those portions of the report relating to China and North Korea; most of the report covered trade with Eastern Europe and the Soviet Union. For the complete text, see vol. i, p. 1186.