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President Eisenhower's first administration opened on a hopeful note in foreign affairs. Faced with a military stalemate in Korea, the North Korean communists signed an armistice agreement with the U.N. Command in July 1953. This agreement formally recognized the division of Korea and provided for the exchange of prisoners. Communist morale suffered a severe setback when tens of thousands of North Korean and Chinese prisoners of war refused, in the presence of Indian observers, to return to their homes.
But the Korean armistice did not end communist expansionism in Asia. In the spring of 1954 a smoldering guerrilla campaign, aided by Communist China, against the legitimate government of Indochina flared up into full-scale warfare. Representatives of Indochina, France, Communist China, the Soviet Union and Great Britain met in Geneva in July and agreed to split the country into two parts. The northern area was recognized as the communist state of Viet Minh (later North Viet-Nam), while the remainder was divided into the three non-communist states of Laos, Cambodia and South Viet-Nam. Significantly, nearly 10 per cent of the population of Viet Minh chose to move to the south rather than live under the communist regime.
To help defend independent Asian nations against further communist penetration or attack, the United States joined with Thailand, the Philippines, Pakistan, Great Britain, France, Australia and New Zealand to establish the South# east Asia Treaty Organization in September 1954. SEATO, as this mutual assistance pact came to be called, provided for economic cooperation, technical assistance, and collective action against aggression or subversion. An attached clause extended the treaty's provisions for protection and economic aid to Laos, Cambodia and South Viet-Nam.
Recognizing that American security and welfare were directly related to the economic and social advancement of peoples in newly developing areas, the United States expanded its technical assistance program for Asia, the Middle East, Africa and Latin America. More than $1,000 million was spent by the United States for relief and reconstruction in war-devastated South Korea; by 1955 that country had regained or surpassed most pre-war levels of production and consumption. Equally effective was the massive assistance given the Philippine Republic to help its rebuilding after the ravages of war and to support its successful fight against communist guerrillas. Altogether, between 1950 and 1960 the United States provided more than 60 nations with medicines, machinery, loans and technicians.
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