Foreign Relations of the United States, 1955–1957, Southeast Asia, Volume XXII

30. Telegram From the Embassy in Burma to the Department of State¹

Rangoon, March 28, 1956—7 p.m.

1109. Saw Kyaw Nyein this morning. Barrington, who took over as permanent secretary Foreign Office this morning and Braddock also present.

Deptel 962² had just arrived. I therefore told Kyaw Nyein that US Government was making every effort to work out a coordinated program to assist in meeting their needs and said that obviously extent of our assistance would have to depend to some extent on extent their commitments to Russians. I said we understood that GUB was committed to take Soviet technicians and advisers for agricultural diversification but wondered if further commitments would be made during Mikoyan’s visit.³ He replied it was only in agricultural field that commitment had been made but that discussions would be carried on re Soviet assistance for tractor factory, truck assembly plant and enlarging steel mill. Extent of commitment would depend on conversations with Mikoyan but it was unlikely any final decision would be made since a Soviet economic mission of 6 people will follow Mikoyan to work out details.

Kyaw Nyein said he appreciated our desire to help but what he needed was some definite assurance of what he could expect from us before making final commitments with Russians since Cabinet was pressing him and bird in hand was better than bird in bush. I replied that it depended on what kind of bird he had in hand. I said I would however urge Department give me some definite answer as soon as possible but that there were many complications as Barrington could explain to him. As indicated second paragraph 962 I told him GUB might well be able obtain considerable assistance from IBRD in addition port and railway project and that this was probably preferable to loan from Exim Bank which required repayment in dollars. He protested that bank was opposed giving any assistance on industrial projects to which I replied I thought there would be some industrial projects which bank might be willing support but that we also would not consider that high priority should be given to some proposed industrial projects.

I also expressed hope agreement on rice for technicians could be reached promptly pointing out that in view Prime Minister’s approach we had been surprised to find GUB now wished use part of funds to pay for American technicians presently employed. Kyaw Nyein said that when matter was raised in cabinet it was general consensus that available funds should be used for that purpose. I said it was very difficult politically for us to purchase rice and that if larger part of funds thus made available could not be used for additional technicians this would leave very unfavorable impression. I said Prime Minister had promised us breakdown of how GUB proposed use funds and had asked Raschid prepare it. He replied that Raschid had not consulted him about it.

In course conversation Kyaw Nyein said he was disturbed about extent Soviet planning for technological institute in view dangers involved since he was afraid this would enable Russians to indoctrinate students even more than at present.

Satterthwaite

1. Source: Department of State, Central Files, 411.90B41/3–2856. Secret.
2. Telegram 962 to Rangoon, March 26, authorized the Embassy to inform the Burmese Government that every effort was being made to work out a coordinated program to assist in meeting Burma’s needs and to reemphasize how important it was that Burma avoid making further commitments to the Soviet Union that would arouse U.S. public opinion and might negate the efforts that had been made. (Ibid., 411.90B41/3–2656)
3. Mikoyan visited Rangoon March 30–April 1.