Foreign Relations of the United States, 1947, The Far East, Volume VI

656D.006/3–847: Telegram

The Acting Secretary of State to the Embassy in the Netherlands

confidential
us urgent

Washington, March 8, 1947—5 p.m.

114. Urtels 147, 150 Mar 6.²⁷ Dept considers oral observations Chief, Political Section²⁸ as well as Neth press release unsatisfactory in tone and substance. Pls deliver following by hand to FonMin²⁹ immediately.

“Excellency:

I am instructed by my Govt to inform you as follows:

The Dept of State regards the oral observations made to this Emb, as well as the press release of the Neth Govt of Mar 6, on the subject of representations made by the US Govt to the Neth Govt in regard to the NEI import-export regulations and in regard to the Martin Behrman as unresponsive and in certain other respects unsatisfactory.

The Neth Govt is aware that the US Govt has borne in the past, and continues to bear, a large part of the burden of relieving world food shortages. Accordingly, the interest of the US in the situation now existing in the Neth Indies goes far deeper than its own need to acquire commodities available in the Neth Indies for its own purposes. The US Govt is interested in the immediate export of commodities which are needed throughout the world for the relief of world shortages which are prolonging widespread economic disturbances. Therefore, in view of the US Govt’s immediate and compelling responsibilities in respect to the relief of such shortages, it can not be satisfied with the statement of the Neth Govt that ‘the new export and import regulations have in view the promotion of legal export’. The principal interest of the US Govt in the export-import regulations of Jan 29 is not in their intent but in their effect. It was to an immediate and salutary modification of the effect of the regulations that the Dept’s representations of Mar 3 were directed. The Dept remains unconvinced that the regulations will ‘divert exports to regular channels’. In the view of the Dept the effect of the regulations is to place upon the ordinary course of trade with the Neth Indies such uncertainties and complex procedures as to make it improbable that the commodities known to be available will in fact be forthcoming.

The Dept of State considers that any measures taken by the Neth Govt which tend to retard the economic rehabilitation of the Indies seriously and adversely affect world political and economic stabilization. Accordingly, in view of the FonOff statement that the regulations are not designed to hamper export trade, the attention of the Neth Govt is invited to the absolute prohibition of the importation into territory within the de facto jurisdiction of the Indonesian Republic of producer and consumer goods without which commercial relations can not be resumed and economic rehabilitation of the Neth Indies can not take place. For example, the great need for the rehabilitation of the transportation system of the NEI is well known. The regulations of Jan 29 absolutely prohibit the importation into Java, Sumatra or Madura of motor vehicles or railroad equipment of any sort.

The Dept of State therefore urgently requests that prompt consideration be given to the revision of the export-import regulations of Jan 29 in a manner which will make possible the movement of the commodities covered by them into the normal channels of world trade.”

Pls point out to FonMin orally the following:

A. With regard to SS Martin Behrman,³⁰ continued widespread publicity, both press and radio, caused by this incident is having a harmful effect upon traditionally favorable attitude of American public toward Neth which may well outweigh in importance financial considerations involved. Fact Isbrandtsen Company sought and obtained before undertaking transaction specific assurances from Neth Emb, Wash that purchase rubber, sugar, other commodities at Cheribon through agency Perseroan Bank not in conflict existing NEI regulations gives slant to publicity favorable to Company and unfavorable to Dutch while recent press reports of physical constraint in moving vessel at Batavia are arousing unfavorable public reaction. Dept therefore earnestly requests prompt remedial action case Martin Behrman.

B. With regard to trade regulations, situation somewhat analagous to that which exists in the NEI developed in Siam in 1946 in connection with export tin metal and tin concentrates which had been mined from foreign-owned concessions during war. It was proposed during early stage of discussions to restrict export all tin from Siam until bona fides its ownership could be established. It became obvious proposal require proof non-foreign origin as condition to exportation tin would act as practical prohibition upon any substantial export this metal, would impose prohibitive burden on exporters who had clear title, and would seriously and adversely affect economy Siam. Agreement was therefore reached between Siam and Govts concerned upon a stated amount of tin as amount derived from foreign-owned concessions and upon method of paying compensation which made full allowance for expenditures incurred in production such tin by others than concessions holders. The effect of this agreement has been to afford fair protection to lawful concession holder, to remove cloud on title to tin in Siam, allowing it freely enter world market, and to permit Siam promptly to realize benefit foreign exchange made available to her through its sale. While recognizing greater complexity problem in NEI, this Govt believes similar arrangements could be made with de facto Indonesian Republic especially in light of Article XIV of Linggadjati Agreement.

Acheson

27. Neither printed.
28. Jonkheer Van Vredenburch.
29. Dr. Carel Godfried W. H. Baron Van Boetzelaer van Oosterhout.
30. Telegram 68, March 3, 10 p.m., from Batavia reported that the ship reached Batavia on March 2 “voluntarily and under own steam”, thus avoiding an “unhappy incident which certainly would have occurred if ship had attempted illegal sailing.” (656 D.00613–347)