Complex sentence: Yet CIA reports did not present an optimistic appraisal of its future, but understood that the anti-colonialist and nationalist context then prevailing favored the new communist regime in the north led by Ho Chi Minh, who was widely admired as a Vietnamese patriot.
Split into simpler sentences: Yet CIA reports did not present an optimistic appraisal of its future. Its analysts understood that, in the anti-colonialist and nationalist context then prevailing, a favorable outcome was more likely for the new communist regime in the north led by Ho Chi Minh, who was widely admired as a Vietnamese patriot.