Office of the Historian

12. Memorandum of a Conversation, White House, Washington, June 29, 19551

Washington, June 29, 1955

SUBJECT

  • Economic Situation in Burma

PARTICIPANTS

  • President Eisenhower
  • Secretary Dulles
  • FE—Walter S. Robertson
  • FE—William J. Sebald
  • Prime Minister U Nu, Burma
  • U Thant, Prime Minister’s Secretary

President Eisenhower asked Prime Minister U Nu concerning the economic situation in Burma. The Prime Minister replied that some difficulties had been experienced because of Burma’s failure to dispose of its surplus rice, stating in response to a question that the surplus at the end of the year will be two million tons (sic). The President asked whether our agricultural surplus disposal program was causing any difficulties to the Burmese economy and, if so, in what manner. U Nu replied that he was well aware that the United States was having great difficulties in connection with agricultural surpluses. He was also cognizant of the fact that it has become necessary to dispose of some of these surpluses in Asian markets. At the same time, however, he did not wish to give the impression that he had come to the United States for the purpose of complaining or making any protest whatsoever regarding U.S. policies in this regard. Burma would simply have to accommodate itself to the realities of the situation and work out its problems in its own way. At the same time, however, he hoped that the United States would view sympathetically [Page 15] Burma’s difficulties and would not think ill of Burma’s policies growing out of its economic problems.2

The Prime Minister spoke of the need for developing markets for Burma’s rice in the Communist bloc countries, specifically Communist China and Soviet Russia. He said that a contract had just been signed with Yugoslavia under which the latter agreed to purchase 50,000 tons annually for five years. In view of the need to have friendly relations with Communist countries in order to develop markets for the principal crop of Burma, the Prime Minister reiterated his hope that the President and other U.S. officials would understand Burma’s difficulties.

The conversation turned to the problem of barter trade between Burma on the one hand and China and Soviet Russia on the other. The Prime Minister said that the arrangement with the CPR provided for a 20% cash payment which, however, would be used by Burma to pay for transportation costs. The balance of the payment would be in goods of various kinds which he was unable to specify. Some capital goods were included. The contract with Soviet Russia, on the other hand, provided solely for capital goods in payment, with no cash involved. The Prime Minister said that these arrangements raised considerable difficulties for Burma, but under the circumstances no alternative seemed possible.

  1. Source: Department of State, Central Files, 890B.00/6–2955. Drafted by Sebald on July 5. Confidential.↩
  2. According to a memorandum of discussion of the June 30 meeting of the National Security Council, President Eisenhower observed that “because of his Buddhist principles, U Nu could not be induced to lodge a protest over the fact that we had given 100,000 tons of rice to Japan. Accordingly, the President said he was almost obliged to drag evidence of concern from the Burmese Prime Minister over this loss of the Japanese market for surplus Burmese rice.” (Eisenhower Library, Whitman File, NSC Discussions)↩