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

460.509/10–1051: Telegram

The Ambassador in Indonesia (Cochran) to the Secretary of State

secret
priority

Djakarta, October 10, 1951—1 p. m.

552. Djuanda called ninth my request. Gave him copy memo to FonOff based on Dept A–60, Sept 21¹ requesting copies current Indo agreements with Soviet satellites. I indicated info Emb has on trade under these agreements and specific points on which data lacking. He uncertain whether govt wld provide copies but said this matter for FonOff decide and he wld speak to Subardjo. Ref Embtels 493 and 509² and Deptel 422.³

Djuanda said agreement reached with Czech on 1951–1952 trade and awaits only final approval and signing by govt. Said Indo negotiator Asmaun had been given instructions by fin and econ comite as to how far he cld go in negots and had accomplished agreement within such scope. Said it wld now be most difficult for Indo go back on these negots. He let me know new arrangement provides for Indo export 500 tons tin and 1500 tons rubber to Czech. Last year’s tin contingent 700 tons. Asmaun was auth go up to this total in new agreement but held figures down to 500 tons against Czech request for 1750. Under 1950–1951 agreement Czech actually recd only 400 tons since Czech unable provide adequate goods in compensation.

I pointed out to Djuanda unhappy reaction which wld take place in US if now revealed Indo has agreed provide Czech with tin and rubber through negots undertaken in spite Kem amendment and consummated shortly after Indo given provisional period of exception from Kem amendment. Djuanda argued UK and other Western Eur countries continue receive US aid in spite much more important exports from those areas to Soviet area than Indo sends satellites. I followed arguments of Deptel 422. Djuanda countered we shld check at Hague on tin and other strategic exports of Neth to USSR and satellites. He said Indo Govt knows Neth receives more tin from Indo than requires for own needs and uses this in trade with satellites. Said through manipulations of “East–West” Company Neth switched tin and other strategic materials through transactions with Western Germany to destinations behind iron curtain. He pointed out Indo prospective tin contingent for Czech constitutes about 1 percent annual Indo production.

I stressed good impression Indo wld make on US and on world in general by showing courage to cut out strategic materials entirely from Czech agreement. He said while this might receive some applause, it wld definitely be attacked by Commie countries, and wld draw much opposition to govt internally. I said if such step cld be taken in spite obstacles thereto it shld be easier accept existence two other running agreements namely with Hungary and Poland which include strategic materials. Djuanda doubted anything cld be done and hoped we wld be satisfied with narrow limits within which Indo keeping exports of strategic materials to satellites.

To justify such exports to Czech, Djuanda stressed importance to Indo, economy of Czech materials recd in return. He mentioned particularly paper required by press, which sharply critical of govt unless needs taken care of, and Polish steel and tools required to keep up Indo economy, and especially to increase production strategic materials for export. Djuanda thought Indos record more than favorable compared with UK and Neth.

Djuanda phoned tenth wld see Subardjo and Wilopo tonight. Said he wld urge them make copies current trade agreements with satellite countries available to me. He felt disclosure facts in case wld convince US auths Indos in position justify Kem exception. I told him easier for sympathetic consideration be given if Indo Govt discloses facts frankly rather than obliges us seek info from various sources and then perhaps make recommendation and take decision on incomplete info.

I reiterated to Djuanda advantage to Indo under Kem or Battle legis or moving far as possible now toward cutting down exports strategic materials to satellites. He promised do his best. He is to report back tomorrow. I will see Subardjo twelfth. With Djuanda thoroughly appreciating importance cooperating with us I am confident whatever he can achieve for us now will be more than I cld get through straight negot at Ministries Foreign Affairs and Economics and will be maximum we can obtain for present. Had I known in advance exception was to be made Sept 13 I might have bargained that against Indo eliminating strategic materials from Czech agreement then in course negot.

Cochran

1. Not printed.
2. In telegram 509 from Djakarta, October 1, Ambassador Cochran informed Foreign Minister Subardjo that the proposed Czech-Indonesian trade agreement, if it encompassed the selling of strategic raw materials to a Communist state, could have serious repercussions upon U.S.-Indonesian relations and could cause the United States to revoke Indonesia’s exemption from the provisions of the Kem Amendment (656D.94/10–151).
3. Supra.