Office of the Historian

892.51/237: Telegram

The Minister in Thailand (Peck) to the Secretary of State

Bangkok, December 1, 1941—4 p.m.
[Received December 1—3:11 p.m.]

544. Legation’s 540, November 30, 5 p.m.

1.
In August Japan pressed the Thai Government to advance ticals against yen credits. The Thai Government courageously refused and thinking to avoid entanglement in the yen bloc and also hoping that Japan would have no gold insisted on payment in gold. It also refused Japan’s request that gold be “earmarked” and left in Japan and demanded shipment to Bangkok. Negotiations culminated on November 27 in a request from Japan that the Government supply 80 million ticals in notes against gold deposited in Bangkok and the Government felt powerless to refuse, especially as the gold was left [Page 364] for free use. This is substantially the account of these events given me by financial adviser Doll, and it seems credible.
2.
For a number of days no United States dollar exchange has been obtainable in Bangkok. This has of course effected a practical embargo on all purchases from the United States whether by the government or private individuals and firms. Funds cannot be sent for the support of students in the United States and the Philippine Islands. The result has been actual hardship and a feeling of depression. This is not a condition conducive to enthusiastic resistance to Japan and support by the Thais of the principles upheld by the United States and Great Britain.
3.
It is of course undeniable that the Thai purchases of Japanese gold have circumvented the presumed object of the American and British freezing orders in that they have facilitated acquisition by Japan of rice, rubber and tin. In extenuation it may be noted that the Government has steadfastly protected American and British opportunity to buy the same materials even without insisting on receiving the all important dollar exchange. Thailand has resolutely followed a course of impartiality. Unable to promise the military assistance for which the Thai Government has repeatedly asked, the American and British Governments could hardly have expected this small country to go further than it has in disregarding the threats of a powerful and predatory neighbor.
4.
I therefore earnestly believe that it would be only just, as well as politic, to give Thailand an immediate allotment of dollar exchange. Whether or not Thai gold shall be accepted as security or purchased outright seems unimportant compared to the desirability of extending this country’s assistance and encouragement in a moment of anxiety and distress. Thai Government is solvent and has an honorable financial record, and security could well be relaxed. Through export control, the credit would be [at] all times subject to American supervision except in respect to the small portion used for personal remittances.
5.
I am expecting momentarily a communication from the Minister for Foreign Affairs on this general subject.
Peck