493.56D9/7–554: Telegram
No. 276
The Ambassador in Indonesia (Cumming) to the Department of State
priority
27. My telegram 24.1 I saw the Prime Minister this morning and as instructed in Deptel 13,2 I told him that I thought it would be most useful if he could give me a clarification of press reports both in Indonesia and abroad that Indonesia was contemplating sale of rubber to Red China. I said that I was reluctant to believe that these stories were correct and suggested to him that since a Polish ship was involved that perhaps rubber was in fact destined to Poland to which country Indonesia rubber had been shipped for sometime past. I made the five points outlined in Deptel 13, and based my presentation on the advice given Baldwin by Mukarto (Deptel 16).3 Ali, who spoke very quietly and in a friendly way during the entire conversation, said that he would “look into the matter” and added that he assumed from my manner of presentation that in mentioning the Battle Act I was not “threatening Indonesian Government”. I replied that he was quite correct, but that if [Page 438] the press reports were true our friendly feelings towards Indonesia required that we inform him as Prime Minister of the content of our domestic legislation which had as its primary aim the support of the United Nations, a principle to which his government as well as he personally thus far had given unwavering support despite the economic cost.
There followed a 45-minute conversation which might be summarized as follows:
While never admitting directly that Indonesia planned to send rubber China, Ali said that he was in dilemma: On the one hand, 10 million Indonesians were dependent upon exports of smallholder rubber, markets for which were difficult to find; on the other hand he was faced with adverse of American reaction and possible invocation of Battle Act plus being charged with breaching UN embargo—with respect to latter he quoted that Indonesia had abstained in the vote on the resolution. With respect to invocation of Battle Act he said he found it difficult to believe that in weighing relative strategic importance to the US of a few small shipments of low grade rubber to China against deterioration of Indonesian-US relations we would not (a) sympathize with Indonesia’s economic and financial situation and therefore (b) exercise discretion which he said he thought was permitted by Battle Act. On the American aid question he said that our technical assistance had been much appreciated and had been helpful to Indonesia but that its volume was not sufficient for it to be missed if withdrawn. Over and over again he referred to his desire improve US–Indonesian relationships which had “deteriorated or at least lost their warmth” during past 3 and ½ years but balanced against this his duty to look after economic interests of his 10 million smallholders.
I told the Prime Minister that I felt that my government also wished to maintain as warm as possible relations with Indonesia and that I was prepared at any time to transmit any suggestions to that end that he might have in mind as well as any possibilities that might be explored for assisting Indonesia within the limits imposed on us by other commitments and our own policies and by Indonesia’s wishes. He made no reply to this statement but reiterated (a) his intention “to look carefully into the matter of rubber shipments and to let me know results”, (b) his plea for understanding by the US of Indonesia’s difficult economic and financial position and (c) his hope that we would find an area for the exercise of executive discretion in application of Battle Act should some shipment take place.
Comment: Pulaski is still in the stream off Tandjong Priok and loading very slowly (about 200 tons per day with no loading yesterday). This fact together with care Ali took not to acknowledge any detailed knowledge of any transaction with China leads me to believe that such a transaction is in fact under consideration but that he is dragging out implementation as long as possible to test US reaction, to improve bargaining position during current trade and [Page 439] prospective dual nationality negotiations with Red China, perhaps to induce offer of financial and economic assistance by US, and at same time trying not to go so far so quickly that he cannot reverse his course of action if necessary.
Regardless of the foregoing I cannot escape the conclusion that Ali is fully prepared to face up to the consequences of rubber shipment to China if that should be his final decision and that for some time past his intentions to take such a decision has been firming. I also believe that he is banking very strongly on the possibility that the US will not take any retaliatory action under Battle Act because of adverse affect on public opinion in Indonesia and Southeast Asia.
I urge that there be no publicity on the representations to Mukarto or to Ali and Indonesian Government be given reasonable period for digestion. I think publicity-wise the situation can best be handled by carefully planned and not too obviously inspired press comment which would not close door to a possible reconsideration by Ali without loss of face.
If the shipment should take place and if after careful weighing of the pros and cons US Government should decide to terminate aid program Indonesia, I urge that this be done in such a way (if legally possible) as to make quite clear that aid can and will be resumed if desired by Indonesia whenever prohibited trade with Red China ceases. This will not in any way mitigate the to be expected virulence of Communist and Nationalist propaganda testament of our action but might give opposition parties basis for attacks on PNI government. In this connection worth noting that since recent opening of trade negotiations with China opposition press has counselled against trade with China and violation UN embargo.
- Dated July 3; it informed the Department of State that Cumming had arranged to meet the Prime Minister on July 5. (493.56D9/7–354)↩
- Document 274.↩
- Supra.↩