851G.00/5–747: Telegram
The Consul at Saigon (Reed) to the Secretary of State
145. Usually reliable source states today’s meeting Mus92 and Giam near Hanoi (1) to arrange armistice and (2) arrange basis for future negotiations. Valluy’s Chief of Staff has proceeded Hanoi for details armistice probably contacting Giap.93 Informant says French not committed treat solely with Ho but want to enlarge negotiations include other elements, Bao Dai backers, et cetera—also French have no concrete plan for future except (1) abandon political federation and (2) insist upon economic [and] cultural agreement covering all French Indochina including free ports and transit rights for Cambodia and Laos. Confirming this lack of plan, he states Bollaert has called for final report organization needs, et cetera, various federal services now operating French Indochina to be submitted May 10th and when asked what will be future jurisdiction [and] scope such services, Bollaert replied he had no idea.
Informant believes French will try sell idea Vietnam federation with each of three “Kys” having autonomy. Hoach he states gaining ground in Cochin China and Bao Dai might go back Annam. He states movement Annam reported mytel 144, May 5,94 not organized Government but only grouping of pro-Bao Dai elements.
[Page 94]This informant says Chinese flocking into French Indochina at rate of from 6 to 10 thousand per month and adds he voices sentiment majority of French in stating China is eventual danger to French and whites in French Indochina, that Communists and Kuomintang while fighting each other have single purpose as regards French Indochina. His sources in China indicate might be Chinese intervention Tonkin if not for difficulties with Communists. He forsees eventual Chinese domination Vietnam with Cambodia [and] Laos forced towards Siam and Buddhist country bloc and is frankly less apprehensive Communist danger than before, however feels outcome political situation in France will influence development Communist possibilities in French Indochina.
With reference Deptel 71, May 3, believe Chinese Consul General here playing with Bao Dai element and Chinese Consul General Hanoi playing with Vietnam so China will have two strings to her bow—no question Chinese Consul General here is contact man for Bao Dai and National Democratic front elements.
Please pass Paris Nanking.