501.BC Indonesia/10–1849: Telegram

The Chargé in the Netherlands (Steere) to the Secretary of State

secret   priority

962. Hicus 66. Van Royen phoned last evening and sought my ideas on “self-determination”, particularly for areas which Republican claims but under Netherlands’ control since second police action. I mentioned New Guinea problem. Van Royen advanced idea application being made to UN for Netherlands’ trusteeship over specific number years. Said action on application would require perhaps one year and situation could be better judged within that time.

Van Royen phoned again 10 p. m. Said Cabinet seriously concerned over reports from Indonesia and was issuing statement to effect it supported position taken by Lovink. I said conditions Indonesia made it all more urgent we rush conference to termination. Van Royen agreed.

Roem phoned 11:30 p. m. Said Republicans just finished meeting with BFO and thought they had “terms reference” that would be satisfactory for small committee. Arranged I should get details this morning.

Called on Roem 9:30 a. m., he translated from document in Indonesian [Page 534] which represented result Indonesian meeting on debt problem and terms reference small committee. Following is summary translation thereof:

“Debt commission” to be established by steering committee to include one representative each from Netherlands’ delegation, RepDel, BFO and UNCI. Purpose is to seek agreement concerning amount of debt at time of transfer sovereignty, it being understood that in [tin] pledge and percentage of exports will not be used as guarantee. Commission will decide amount of debt. Procedure of commission to be left to agreement within commission itself. Amount of settlement can be changed if proved later that commission decision based on erroneous data. If debt burden unbearable, schedule of amortization can be changed. Points covered 32 contingencies would be decided by committee of 3 to be set up by Netherlands appointing one member, Indonesians, second, and 2 members to choose third. Their decisions would be binding.

I asked Roem if small committee would definitely have authority to fix full terms debt settlement. He said this was his understanding. I said Indonesians anticipating negotiations by excluding tin pledge, etc. Roem still thought terms would be acceptable Netherlands. In answer my query, said Indonesians had not yet informed Netherlands of terms. Asked me convey them to Van Royen. I said I would act as intermediary only to point of getting Netherlands directly in touch with Republicans through Roem or Djuanda.

As I was leaving I said if we could once get financial problems settled, I was sure conference would end successfully. Roem said we would still have New Guinea. I asked what he thought of Netherland’s trusteeship. Roem pled for transfer sovereignty to include New Guinea with understanding negotiations be entered subsequently with Netherlands and foreign countries perhaps through UN as to how New Guinea should be handled. He opposed trusteeship in lieu transfer sovereignty.

Called Foreign Office and shortly received by Stikker, Van Royen and Hirschfeld. I gave them information on Indonesian terms reference. Van Royen argued tin pledge essential. Stikker agreed with me that Lieftinck had not included this in five points his original memorandum which had provided basis my first approach to Hatta and Stikker’s subsequent talk with Hatta at luncheon. When Van Royen urged necessity of security, I said I had not argued one way or another but stressed importance to Indonesians of honoring contracts, whether any revenues pledged, if USI to have credit standing. Said exacting of pledge in partnership arrangement might be questioned. I said pledge certainly insufficient ground for breakdown negotiations on financial settlement upon which entire success RTC depends.

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Stikker thought hopeless try get question terms reference for committee worked out in time for action by steering committee this afternoon. Van Royen suggested Stikker see Hatta soonest. This was not immediately possible since Drees talking with Hatta on Indonesian situation. I urged and Netherlands trio agreed Hirschfeld should see Djuanda at once and get Indonesian terms reference directly from latter in Dutch and not depend upon my message as official. I said Hirschfeld and Djuanda should discuss terms with Hirschfeld raising any objections Netherlands desired and Djuanda being given chance explain or seek amendments. I recommended further that Hirschfeld report back promptly to Stikker and latter still see Hatta before steering committee meeting and endeavor get terms reference agreed upon.

Upon leaving meeting Van Royen told me Stikker and he had been meeting with Maarseveen and entire government considered Indonesian situation critical. I said we all recognized some deterioration. I reminded him, however, that he and I had seen no alternative but follow course we had in line with SC directive. I stressed urgent now every one keep steady and finish RTC in few days. I thought conservative leaders here could handle situation once returned to Indonesia with successful agreement. I cautioned Van Royen against taking Lovink too seriously, reminding him of Lovink’s tendency to see Communists in every shadow. Van Royen assured me he was mindful thereof. Signed Cochran.

Sent Department 962, repeated Batavia 90.