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 4. . . . (1) On December 13 General Ely and I agreed on a force structure for the Vietnamese Armed Forces and om the assumption by MAAG of full responsibility for training these forces under the overall authority of the Commander-in-Chief in Indochina. Delay by the French Government in approving our agreement on this subject has held up implementation of this aspect of the program.

(2) The same agreement referred to above provides that the Vietnamese Armed Forces will be fully autonomous, that is staffed and commanded solely by Vietnamese officers, by July 1, 1955.

(3) Additionally, on January 19, I reached agreement with President Diem and the Vietnamese Minister of National Defense on a slightly modified force structure and on a progran for reorganization of the Vietnamese Armed Forces in which General Ely concurred. This agreement is contained in an exchange of letters between the Vietnamese Government and me.

(4) The structure of the Vietnamese Armed Forces (shown in Enclosure A) is designed to accomplish a two-fold mission: the establishment and maintenance of internal security; and the capability of providing sufficient initial resistance to external attack to prevent the country from being rapidly overrun before outside assistance can be brought to bear. To accomplish these missions the Army is to be organized into six divisions: three territorial divisions, essentially existing regional commands; and three field divisions to constitute a mobile battle corps to reinforce provincial units and provide a delaying shield in event of aggression.

(5) This structure is based on the concept that a relatively small force, properly trained, equipped and led, can perfor, the above missions more effectively and at less cost than a larger force which would be disproportionate to the economic and manpower capacities of the country. In any case, the Viet Minh enemy, backed by its Communist Chinese ally, could always maintain the capability of matching and exceeding whatever number of divisions free Vietnam could put into the field.

(6) Thus the Vietnamese Armed Forces described above, and the concept upon which their structure is based do not in themselves insure he security of free Vietnam in the event of eternal attack. Such security must depend ultimately on the Manila Pact Powers and the action they would SECRET Rh