756D.00/2–650: Telegram

The Secretary of State to the Embassy in Indonesia


150. Dept has closely studied views expressed urtels 206 and 210.1 UnderSeey2 who has followed this matter carefully did not intend that Dept, in any manner, give impression that you shld vouch to RUSI officials for Fox. As you know, Dept in past has made clear that our objection to so-called “Fox” contract was not on basis of character of Fox but on basis restrictive features contained in that document. These restrictive features to which we objected do not appear present in principles laid down by Nathan’s ltr.3

Dept’s present concern this matter is to contract out of position which it has taken on basis restrictive provisions contained in “Fox” contract with object of leaving Fox vis-à-vis this govt in same position as any other Amer businessman.

Dept does not desire that you shld take action against your judgment based on local conditions. We believe, however, that you may wish, after reviewing matter in light above, speak to appropriate RUSI official along fol lines:

“Fox” contract has not prejudiced Fox as individual in eyes Dept. Any future arrangements between Indos and Fox will be viewed by Dept on ad hoc basis on principles of US policy. Restrictive features which Dept found objectionable in “Fox” contract does not appear to be present in lines laid down by Nathan’s ltr (Deptel 125).4

  1. Neither printed. In the former Cochran reported that he had consistently expressed to Indonesian officials and Fox the desirability of providing open fields for foreign investors without exclusive contracts or special favors, while in the latter he repeated Sukarno’s criticism of the United States “policy of endeavoring ‘administer’ affairs of young Asiatic countries when giving assistance.” (756D.00/2–650 and 856D.10/2–650)
  2. James E. Webb.
  3. Not printed. A copy of this letter, delivered to the Department of State by Robert Nathan, Economist and Representative of Matthew Fox in Washington, was transmitted to Djakarta on February 3 in telegram 125, not printed (411.56D31/2–350).
  4. In telegram 275, February 18, from Djakarta, not printed, Cochran stated:

    “I have done nothing to prejudice position Fox as American competitor for trade opening in Indonesia. I prefer make no statement RUSI Government in his behalf. My impression is that his old Republican friends will see that he more than generously treated this respect.” (411.56D/2–1850)