856D.10/6–1250: Telegram
The Secretary of State to the Embassy in Indonesia
537. Ref Embtel 772, Jun 12.1 Dept satisfied with manner in which RUSI Govt has so far handled question recognition Ho Chi Minh and is particularly appreciative of response by Indos to your observations. Dept inclined believe that present RUSI Govt will not take [Page 1030] further steps looking toward recognition Ho regime Indochina for foreseeable future. We think that while Indos, at present, do not wish become involved in cold war on our side they are far more unwilling to become involved on other side which wld, of course, be result of their recognition of Ho.
Importance of Indo to US policy in Southeast Asia remains unchanged. ‘Indochina is currently under most severe attack and is area made vulnerable by past mistakes of Fr which allowed Commies to capture control of deep-seated natl movement. Dept is sure that you understand necessity of immed support, particularly along mil lines, to Indochina. This does not mean that Indo will be neglected or that its importance to US has, in any manner diminished.
We recognize that implementation of plans to assist Indo has not been as rapid as you and we have desired. We remain hopeful that we will be able to bring forward assistance along lines with which you are familiar in near future. If you so desire, you may reassure RUSI officials that there has been no cooling of our attitude because RUSI may not yet see eye to eye with us on Indochina.
We can do nothing at present re possibility obtaining additional ExImBank credit for RUSI for textiles. However, you shld keep in mind that Army continues to express strong interest in selling Jap textiles in Indo and that their concern has been the manner in which such textiles cld be financed. Refusal of ExImBank to consider additional credit merely eliminates one possibility for financing such transaction.
- Not printed; in it Cochran reported on various economic and political problems confronting the RUSI Government and expressed anxiety that the United States might lose the friendship of Indonesia “if after having made financial commitments we falter to such extent that moderate government which we have considered hope of new nation is embarrassed and perhaps defeated by our default.” (856D.10/6–1250)↩