Foreign Relations of the United States, 1951, Asia and the Pacific, Volume VI, Part 1

856D.00R/5–551: Telegram

The Administrator, Economic Cooperation Administration (Foster) to the Embassy in Indonesia

secret

Washington, May 5, 1951—4 p. m.

Ecato 252. This is joint State–ECA cable. Fol will answer your recent letter queries¹ re status Indo program.

As result extensive discussions Dept and ECA, full agreement reached concerning Indonesia program for remainder FY 51 and FY 52 as follows:

1. For FY 51 total program $9.95 million. This represents approx $3.7 million above amount already obligated, distributed in fields public health ($2.3 million) agriculture, forestry, fisheries ($.9 million), industry ($.5 million). FY 51 program this size will require approx $1.9 million in addition to unobligated funds presently available.

2. For FY 52, an econ aid program of the gen character of the present program with special emphasis on technical assistance. TA personnel would not necessarily be tied to particular projects, and would be furnished on a contract basis or directly by STEM depending on Indonesian wishes and STEM judgment.

3. The FY 52 program proposed to Bureau $10.4 million in grant aid, distributed in fol fields by way of illustration: Public Health ($3.9 million); agri forestry, fisheries ($3.7 million); Transportation, communications, power and public works ($410 thousand); engineering services ($.6 million); Information ($.2 million); Education ($.3 million) and Public Administration and Technical Assistance ($1.6 million). Figures in parens exceed $10.4 total due to inclusion some of TA under public health, transportation, and agriculture categories as well as under public administration and TA.

4. Dept and ECA in full accord re desirability programming additional loans probably Eximbank for Indo if and as study of individual projects so warrants. To this end, appropriate Ex agencies currently discussing suitable mechanism for extending program loans in FY 52 to SEA countries generally, such loans to be integrated with and coordinated as part of same program US economic and technical aid for which grant aid being extended. Will advise you further as these discussions progress.

Foregoing recommendations fully cleared throughout Ex agencies and presented to Budget Bureau on April 13.² No indication yet as to action to be taken by Bureau.³ Forwarding by pouch documentation and elaboration of FY 52 program as presented to Budget Bureau.⁴

Foster

1. Not printed.
2. See the first footnote 1, p. 636.
3. In telegram Ecato 324 to Djakarta, May 29, Mr. Shannon McCune, Acting Chief, STEM Mission in Indonesia, was informed that the Bureau of the Budget had approved a figure of $8,000,000 for economic grant aid to Indonesia (ECA Cable Files: FRC Acc. 53 A 278, Box 77).
4. Not printed.