Memorandum of Conversation, by Mr. William S. B. Lacy, of the Office of Philippine and Southeast Asian Affairs


Mr. Soedjatmoko called at his request bringing with him Mr. Abikusno whom he identified to me privately as the most powerful leader [Page 568] of the Darul Islam. Mr. Abikusno is to return to Indonesia on Monday, having spent some time in Surinam, in contact with Islamic leaders there.

I opened the conversation by soliciting Mr. Soedjatmoko’s reaction to the agreement reached at the Round Table Conference at The Hague. Mr. Soedjatmoko deferred to Mr. Abikusno, explaining that Mr. Abikusno would have to convince his followers of the justice of the settlement. Questioning revealed that Mr. Abikusno considered the agreement probably unsatisfactory to his constituents in two particulars: (a) the acceptance of the Netherlands Crown as a symbol of the Union, and (b) the assumption of debt by the Indonesian State in a larger sum than they had desired. Mr. Nolting told Mr. Abikusno that the Department considered the settlement remarkably favorable to the Indonesians; that the debt provisions were particularly favorable to the Indonesians in that the Netherlands had been obliged to concede one and ½ billion guilders to achieve agreement; and that of the 4.3 billion guilders assumed by the Indonesians, all but 1.3 was internal debt which any successor state must be expected to assume from its predecessor. Mr. Abikusno seemed impressed.

I then showed Mr. Abikusno and Mr. Soedjatmoko the press statements on the Indonesian settlement by the Secretary and Senator Graham1 which Mr. Abikusno read with obvious satisfaction expressing particular pleasure with paragraphs 2, 5, and 6 of the Secretary’s statement. He explained that Dr. Hatta’s predecessor, Sjafruddin [Communist traitor in September 1948]2 had clapped him in jail for nine months because of his anti-Communist activities. He added that Islam and Communism were absolutely incompatible and Islam would continue to fight Communism in every way it thought effective.

There followed a long discussion of the significance of Paragraph 5 of the Secretary’s press statement. Mr. Nolting and I explained that ECA would be resumed and we discussed with the Indonesians the composition of the ECA program. It was agreed that the commodities most urgently needed within the next few months, in order of preference, in Indonesia were: (1) textiles, (2) rice, (3) transportation items and (4) agricultural instruments.

The Indonesians made general inquiry of the functioning of the Export-Import Bank. It was explained to them that the Bank advanced loans against specific projects which must be proved self-liquidating; that there was no application for a loan to Indonesia outstanding at the present time; and that the United States would take no action on a loan to Indonesia through the Export-Import Bank or [Page 569] any other agency until the Indonesian State had made formal application. I further explained that the United States was determined to avoid even the appearance of what our enemy described as “financial imperialism” and would not therefore press financial assistance upon the Indonesian State in any form. I went on to say that the United States Government was of the view that loans to Indonesia should be made on a strictly bankable proposition and that I thought the Indonesian State would find this politically advantageous since they could thereby refute any charge that they were accepting political financing from the United States. At this point both Mr. Soedjatmoko and Mr. Abikusno showed lively approval of this policy and Mr. Abikusno said that he thought this attitude on the part of the Department of State would be most useful to him in his efforts to “sell” the Hague Agreement to Darul Islam.

Mr. Abikusno then stated that the Indonesian State desired, above all things, American technicians in Indonesia and the education of young Indonesians in the United States. He was told that the United States Government was particularly eager that Indonesians come to the United States on scholarship exchanges and that the United States would make every possible contribution to relieve the present dearth of technical skill in Indonesia. He was reminded, however, that the United States had many calls upon its limited exportable complement of technicians. Moreover that the schedule of pay for American technicians was relatively high. Mr. Nolting and I expressed the hope that the Indonesian State would therefore make the fullest possible use of Dutch technicians on an employee basis. After much discussion it seemed clear that Mr. Abikusno harbored considerable resentment against the Dutch; that he would not encourage Indonesians to go to school in the Netherlands nor would he abandon his conviction that English should be the second language in Indonesia rather than Dutch. He was agreed, however, that the Indonesians should make full use of Netherlands technical and administrative experience. [Three of Mr. Abikusno’s sons were executed by the Netherlands military in his presence.]3

Mr. Nolting and I took this occasion to explain the Department’s hope that the Statute of the Union would enable the Indonesian and Dutch people to discover anew their dependence on each other. It was apparent that however much or little Mr. Abikusno was impressed with this part of U.S. policy toward Indonesia, he was visibly impressed by the absence of American ambitions in the area.

During the course of conversation, Mr. Abikusno referred several times to the urgent need for a rehabilitation of the communications [Page 570] and transportation system in Indonesia. He said that he, as an architect, was eager to consult with American architects on prefabricated housing. I placed him in touch with Jacob L. Crane, Adviser to the Administrator of the Housing and Home Finance Agency.

Toward the end of the conversation, Mr. Abikusno expressed great satisfaction with the course of the interview and said that it should help him on his return to Indonesia to explain the sympathetic and unselfish attitude of the Department of State.

Mr. Abikusno said in an aside to Mr. Nolting that he realized the creation and maintenance of law and order in Indonesia was the Indonesian Government’s first concern.

Mr. Soedjatmoko remained behind for a brief moment after Mr. Abikusno’s departure to say that he thought Mr. Abikusno had been totally convinced of the Department’s genuine and non-imperialistic interest in Indonesia and that nothing would mean as much to the acceptance of The Hague Agreement in Indonesia as Mr. Abikusno’s approval thereof.

  1. November 3, Department of State Bulletin, November 14, 1949, pp. 752, 753.
  2. Brackets in the source text.
  3. Brackets in the source text.