Foreign Relations of the United States, 1952–1954, China and Japan, Volume XIV, Part 2

794.5 MSP/9–2854: Telegram

No. 808
The Ambassador in Japan (Allison) to the Department of State

confidential

Tokyo, September 28, 1954—6 p.m.

747. Reference: Department’s telegram 588, September 16. Letter from Foreign Minister dated September 17¹ embodies request mentioned reference telegram that $40 million section 550 yen be utilized procure naval vessels Japan for Japanese forces. Letter refers to statements made by United States representatives during Robertson–Ikeda talks in Washington² and Stassen statement in Japan in February 1954 as basis for Japanese understanding that offshore procurement in Japan would total $100 million during USFY 1954; says surplus agricultural purchase agreement concluded on this premise and so explained to Diet, whereas actual offshore procurement contract awards totalled approximately $70 million. Letter states that if $40 million in yen should be spent in payment for offshore procurement contracts totalling only $70 million “not only will declining tendency of special dollar receipts be further exaggerated but it may also adversely affect future purchase of United States surplus agricultural products by Japan”. Letter also refers to Japanese request for 17 naval vessels, says except for two destroyers and two destroyer escorts, no definite indication ever given whether other vessels be furnished.

My reply³ sent today explains again that $100 million figure was estimate, not firm commitment, and cites reason set forth in reference telegram why ship construction proposal not acceptable. In accord with reference telegram, reply also states United States willing make payments against contracts fifty percent dollars fifty percent yen until $40 million yen fund exhausted. Reply explains this proposal as gesture of goodwill inspired by Japanese Government insistence that United States intentions misunderstood. Reply takes occasion to point out United States concern over fact that, while pressing this matter in which no United States commitment made, Japanese Government has apparently so limited funds to be spent for defense this fiscal year that understanding confirmed by Okazaki letter of April 6 will not be fully carried out and this decision made without prior consultation or even notice. Texts airpouched.

Allison

1. Not found in Department of State files.
2. Perhaps a reference to one of the proposals summarized in telegram 958 to Tokyo, Document 706.
3. Not found in Department of State files.