225. Telegram From the Embassy in Indonesia to the Department of State1
2664. Reference Toica 1118.2FonMin called me in this morning to say that Mukarto had been authorized to sign loan agreement along lines mentioned in reference tel. Subandrio expressed strong hope that speedy Washington approval could be obtained.
From general context of discussion with FonMin which covered other matters also it was apparent that Subandrio hopes that conclusion of practical agreements with US will go far to convince Sukarno and left-wing leaders of PNI that it is more profitable to rely on American than on only Soviets or Commie China. Subandrio is frank to state that they not advocating “American way” for Indonesia but he does not on other hand wish Indonesia to fall into “Communist way” by default. What he hopes to produce is an “Indonesian way”.
Subandrio said visit of Djuanda to Sumatra had on the whole been beneficial and that both of them were agreed that large portion of foreign aid or loans should be used in provinces.
I believe our prompt agreement to signing of loan along lines of Toica 1118 would be in our long term interest.3
- Source: Department of State, Central Files, 756D.5–MSP/4–2757. Confidential; Priority.↩
- Toica 1118 from Djakarta, April 25, concerned negotiations for an agreement under which Indonesia would receive a $15 million credit for purposes of economic development from the International Cooperation Administration. (Washington National Records Center, ICA Message Files: FRC 58 A 403, Djakarta)↩
- Telegram 1786 to Djakarta, April 30, informed the Embassy that the agreement had been signed in Washington that day. (Department of State, Central Files, 756D.5–MSP/4–2757)↩