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Declassified per Executive Order 13526, Section 3.3 NND Project Number: NND 63316. By: NWD Date: 2011  particularly those policies that might have dangerous implications for South Vietnamese security. South Vietnam's concern has become acute since the Kong Le coup in August 1960 and the ensuing rapid deterioration in the Laotian security and political situations. South Vietnam repeatedly advocated stronger political support by the US the Boun Oum-Phoumi Nosavan government against the Souvanna Phouma-Kong Le group and has favored armed intervention by SEATO or the West against the -Kong Le insurgency which from the outset of the present Lao crisis the Diem government has labelled as being clearly directed and assisted by the DRV. Concern over the security of its frontier with Laos has led the government to place its armed forces in the border area under a continuing alert status, to dispatch a small contingent of covert military personnel into southern Laos ostensibly to carry out intelligence and reconnaissance operations, and to enter into secret negotiations with the Lao Government for joint planning to defend southern Laos and the border area. Regarding the current international efforts to resolve the Laos situation the Diem government has held that the "neutralization" of Laos would inevitably result in a Communist takeover and thereby aggravate greatly the already serious Communist threat to South Vietnam.

The strained relations with Cambodia since 1954 have been highlighted by several serious crises and protracted exchanges of highly inflammatory propaganda. The persisting problems include border incidents, territorial and financial claims, and covert political conspiracies. The most serious crisis, for example, occurred in the early part of 1959 and centered around probable involvement by the Diem government in an abortive conspiracy against Chief of State (then prime minister) Prince Sihanouk. During the first half of 1961, tensions were exacerbated by the capture of two Vietnamese fishing boats in Cambodian waters and by the flight of some 1,500 Cambodian residents in South Vietnam into Cambodia, probably in order to escape internecine fighting between Vietnamese army and security forces and Communist guerrillas. However, the basic factor in South Vietnamese-Cambodian relations has been Diem's and Sihanouk's intense dislike and distrust of each other, aggravated by the essentially divergent international political orientations. For his part, Diem seems convinced that Sihanouk is unstable and weak, sympathizes with and possibly supports anti-Diem activities by Vietnamese Communist and non-Communists, and cannot be relied upon to keep Cambodia out of Communist hands.

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