448. Staff Study Prepared by an Interdepartmental Committee for the Operations Coordinating Board1



What can and should the U.S. do to counter communist subversion in Malaya?


Recent months have increasingly brought to light the dangerous inroads which communist subversion has made in Malaya, particularly Singapore. If Singapore or the Federation of Malaya should come under communist control, the consequences for the U.S. and its allies would be grave. Thus far, the British, who control Malaya, have given no indication of having developed a comprehensive plan to counter communist subversive efforts in Malaya.

Possible Courses of Action (in summary):

Persuade the British to undertake a plan of action and offer to make suggestions and to consider sympathetically their requests for assistance.
Complete preparation of detailed suggestions for the British.
Offer detailed suggestions to the British on the working level.
Attempt to obtain assistance from the American labor movement.
Increase our exchange-of-persons program.
Be ready to consider proposals for projects under the Asian Economic Development Fund. (See note para. F, page 82)
Urge officials of the University of Malaya to devise a program of development to which U.S. public and private assistance could be given.
Continue the USIS program in Malaya at least at its present level.
See that other Asian governments are aware of communist subversion in Malaya.
Stimulate direct Malayan-Philippine contact.
Support the British if they seek more vigorous Thai antiterrorist cooperation.
Enlist the support of Australia in persuading the British to take action.

Note: All of the above courses of action, as set forth in detail in the paper, have the tentative concurrence of State,ICA, Defense, …. All have the tentative concurrence of USIA except A and H; USIA has not agreed to … any expansion of its own program in Malaya as may be implied in course of action H.

Recommended Action:

That the Board approve courses of action B through G and I through L.
That the Board resolve the differences with respect to courses of action A and H.3


I. Introduction

Despite the fact that after more than seven years British forces are still engaged in a military campaign, only partially successful, against communist guerrillas in the jungles of Malaya, important steps were taken this year in both Singapore and the Federation of Malaya as part of a general program of transition from British rule to self-government for both areas. Each area now has a legislature with a majority chosen by popular election and is governed by an executive cabinet in which elected members participate. The British, however, continue to retain control over foreign affairs, defense, internal security, and currency and foreign exchange.

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II. Assumptions

A. Aims of the Malayan Nationalists

The primary political aim of the Malayan nationalist forces in control of the now partially autonomous governments in Singapore and the Federation is to obtain additional autonomy at the earliest possible date and independence in the near future. Their ability to remain in office depends in large part on how successfully they achieve this objective. The UK Government, being aware of this, will hope that whatever further concessions it makes to nationalist aspirations will be sufficient to maintain non-communist cabinets in office.

B. British Plans for Transfer of Sovereignty

The British will be prepared to make further grants of self-rule provided they believe it can be done in a manner which will ensure a relatively smooth transfer of authority and at the same time will protect essential British interests in Malaya. Whether or not full independence is granted by 1959 or 1960, as has been demanded by some Malayan leaders, will depend to a large degree on the UK estimate of communist strength in Malaya and on the extent of communist expansion in neighboring countries. It is improbable that Singapore will achieve self-government by 1960.

C. The Political Outlook

The next several years will be turbulent ones since the present Malayan leaders, while lacking experience in government, are confronted both with discouragingly complex problems and with communist determination to discredit moderate democratic rule.

D. The Influence of Communism

The political future of both Singapore and the Federation will be significantly influenced by communist activity. In Singapore a communist-oriented political party, the People’s Action Party (PAP), will continue its thus far successful efforts to keep the Marshall Government off balance and would stand a good chance of winning another election. Even if the communists cease active guerrilla operations in Malaya they will still present a serious problem to the British and the elected officials. Further communist expansion in the Far East and, in particular, enhanced prestige for Communist China, would strengthen the appeal communism already has for so many of the Chinese in Malaya.

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E. Possible Revocation of the Constitution

In the event the PAP were to become a majority party in Singapore the UK would find it necessary to revoke the present constitution and limit local participation in government.

F. Strength of Communism in the Federation

Communists in the Federation, while presenting a continuing threat to effective, moderate, non-communist government, are not now in a position to present an electoral threat to the elected government nor greatly to thwart the normal functions of government. (This assumption would have to be re-examined in the event the terrorists accept the amnesty offer and are absorbed into the body politic.)

G. Opposition to Singapore’s Labour Front Coalition

In Singapore the legislative program of the Labour Front, of which Chief Minister Marshall is the leader, is likely to be confronted with conservative opposition, on the ground that it is socialistic, and at the same time to be opposed by irresponsible and fanatic left-wing opposition.

H. Racial Friction

In the Federation, racial friction between Malays and Chinese is likely to emerge, despite current cooperation by the major political groups, if measures tending to equalize the position of the races are adopted. Such friction would probably take the form of Malay extremism. Should Chinese political aspirations remain largely unsatisfied, more Chinese will turn to communism.

I. Retention of British Controls

UK control of Malaya’s foreign affairs and defense will continue for at least the next several years. The UK will wish eventually to retain military base rights in Malaya and will seek to ensure that Malaya remains within the Commonwealth after independence is achieved.

III. The American Interest in Malaya

The southernmost part of the Asian mainland, the Malay Peninsula, is in the very heart of Southeast Asia. With Singapore—one of the world’s great ports and naval bases—at its tip, Malaya is one of the keys to the Indian Ocean and to the South China Sea. Linked to SEATO through the UK, its strategic importance is emphasized by its closeness to other key cities in Southeast Asia and the Pacific. Bangkok, Djakarta, Saigon, Rangoon, and Hong Kong are within four [Page 748] hours or less of Singapore, as the jet bomber flies. Darwin and Calcutta are only an hour or so farther away.

The Japanese used Malaya as a steppingstone when they invaded the East Indies. It could be used so again by an aggressor should its defense be neglected by the Free World.

Control of the Indian Ocean and the South China Sea to a large extent spells control of the vital resources of all Southeast Asia. And the Southeast Asian area produces some 90 percent of the world’s natural rubber and about two-thirds of its tin. It also has the largest oil reserves in the Far East–Pacific region.

Malaya’s economic importance lies primarily but not exclusively in its rubber and tin. In 1954 Malaya produced 32.4 percent of the world’s natural rubber, 35 percent of its tin. But Malaya also produces iron ore, palm oil, coconut oil, copra, and some coal and gold. Recently sizeable bauxite deposits have been found.

The Free World’s need for rubber is not likely to be met from synthetic resources in the foreseeable future. In fact, the demand for natural rubber will probably increase during the next few years. As for tin, there is no synthetic substitute, and no other area of the world is Malaya’s equal as a source.

While it is true that the allied forces won World War II without the resources of Southeast Asia, it is nevertheless true that the accretion to the communist bloc of the rubber, tin, and oil of this area would enormously increase their war potential.

The US shares the interest of the Free World generally in denying the resources of Malaya to the communists and in assuring the availability of those resources to the Free World through Malaya’s orderly transition from the status of a British colony to that of independent self-rule by a government or governments friendly to the US and the Free World.

IV. The Present Threat

Much publicity has been given during the past seven years to the communist guerrilla warfare in Malaya and to the military campaign which the British and Malayan forces have carried on against the terrorists. While guerrilla action continues to be a threat to the stability of Malaya, it is clear that the guerrillas, unless assisted by a large-scale invasion force from outside, are not capable of overthrowing the constituted authorities.

. . . . . . .

Perhaps because so much attention has been centered on the anti-guerrilla military action, authorities in Malaya have become [Page 749] aware only in the past several months of the alarming inroads which communist subversion has made in the schools, trade unions, press, and political parties of Singapore and, to a lesser extent, the Federation of Malaya. As a result, the British have suddenly found themselves confronted with wide-scale subversion without having yet developed a comprehensive plan of action against what is in many ways a far more formidable adversary than the armed guerrillas.

The targets of subversion in Singapore and the Federation have remarkable similarity, but the degree of penetration has varied. In both areas, communist success has been achieved in the Chinese middle schools. The problem in Singapore centers in two of these schools, where 8,000 out of a total Chinese middle school population of 10,000 are located. Seventy or eighty students, many of them over-age, function as ringleaders in the subversive activities of these schools.

In the Federation the schools, even though they represent the area of greatest communist success, are not as deeply infiltrated, nor is the situation as obviously dangerous as in the Crown Colony. For the moment, Penang schools seem to be most seriously affected, with the Kuala Lumpur schools next on the sick list; in neither case is the present danger comparable to that in Singapore. It is probable that students in the Federation are trying to organize a network of subversion throughout the main cities of the country but are meeting with some difficulty because of the more elaborate and effective police controls.

Similarities in the Singapore–Federation subversion pattern end with the Chinese middle schools. In respect to trade union and political party infiltration, there is very little evident similarity between the two areas. In the Federation the trade unions are still controlled by moderate reasoned forces. Individual instances of infiltration have come to light, and there is even a small break-away group which is trying to form a rival union in opposition to the Malayan Trade Union Council (MTUC), but for the moment at least this group has only meager backing. The fortunate fact in the Federation is that subversion at present is of minor scope in both the MTUC and the National Union of Plantation Workers (NUPW), a union which forms the main strength of the MTUC.

Unfortunately, Singapore trade unions present a picture which is considerably darker. It is true that a non-communist federated body similar to the MTUC exists in the form of the Singapore Trades Union Congress (STUC) but its strength is not as great as its Federation counterpart, and the communist opposition it must face is considerably more formidable than anything in Kuala Lumpur. Although the STUC claims 65,000 members, it has roughly only 15,000 actual dues-paying members. The weakness of this group, moreover, must [Page 750] be balanced against the increasing strength of another group of unions which are affiliated with the People’s Action Party (PAP). These latter unions have more than 20,000 members.

Apart from sheer numbers, the trade union danger lies in three factors: firstly, the quality of leadership which in the case of the PAP unions is dynamic, tough, and aggressive, in contrast to the general apathy and inertia of Singapore TUC leadership; secondly, the startling rate of growth of the PAP unions; and thirdly, the increasing control which the PAP unions are exercising over vital sectors of the economy. Many industrial workers of the Colony as well as many transportation, naval base, and public utility workers are now under the control of this leftist organization.

The PAP has not always been successful in its labor tactics. Unpopular excesses were committed at the time of the May 1955 riots for which the political party has been blamed; and an economic error seems to have been committed in saddling the Firestone plant with a strike which lasted several months without tangible benefit to the workers. Despite these slips, the PAP unions have grown in strength compared to the TUC unions. The one point of contact between the two rival groups is in their eager seeking to attract the large masses of workers still unorganized—a task at which the PAP seems to be singularly more adept than its rival.

Perhaps the greatest difference in the Singapore–Federation subversion picture lies in the politics of each area. The PAP controls the allegiance of the leftist-minded Singapore voter, whereas no similar vehicle for leftist expression exists in the Federation with the exception of the Labour Party of Malaya (LPM), a group of badly organized and muddle-headed individuals with little apparent popular support. The LPM is also a non-communal group, getting its support mainly from Indians and Chinese, whereas the PAP obtains the bulk of its support from the Singapore Chinese. The LPM has potentialities for turning into a PAP-type organization, but a great deal of organizational talent and money would have to be poured into the Federation to make the situations at all comparable. For the moment, then, the political danger is primarily in Singapore.

In both the Federation and Singapore, the battle against subversion is being waged in very much the same way as the battle against communist terrorism in the jungle—i.e., with arms and police power. In both areas there is an emphasis on punishment, threats, and force, all calculated to contain subversion within its present boundaries and prevent its future expansion. It may be argued, however, that these tactics are merely causing communism to be more cautious as it advances, while in no way impeding its prospects or diminishing its attractiveness to large masses of Chinese. Even if the British should find it necessary, in the case of Singapore, to revoke the Rendel constitution4 [Page 751] and institute martial control, it is entirely possible that the communists could still so disrupt public order as to render Singapore a liability to the Free World.

As a key to other possible more effective methods, the schools, trade unions, and political parties of the Federation broadly can be considered in the first stages of subversion, whereas in Singapore the development of subversion in these fields is considerably more mature.

V. Interest of Other Countries in Malayan Developments

Developments in Malaya are being watched with great interest and concern by a number of other countries.

The SEATO powers are all conscious of Singapore’s and Malaya’s direct relation to regional military and political considerations. The Thai, particularly, are acutely conscious of growing communist influence on all sides of them. … The Filipinos have indicated a growing interest in events in Malaya.

Indonesia has a special interest in Malaya because of the racial and linguistic ties between the Indonesians and the Malays. Growing communist power in Singapore, which is largely a Chinese city, is noted with anxiety in Djakarta. Official visits to Indonesia have already been made by the elected Chief Ministers of both Singapore and the Federation.

India has representatives in Malaya who have made clear to our representatives their concern over the inroads made by communist subversion.

VII. Conclusions

The subversive threat to Malaya is both urgent and grave.
If Singapore should fall into communist control, we should find it exceedingly difficult to persuade Thailand to continue her role as the principal US ally on mainland Southeast Asia.
One of the explicit purposes of SEATO is to counter communist subversion in Southeast Asia. If SEACDT were invoked and failed to stop subversion in Singapore, the result would be a serious and visibly adverse impact on SEATO as an effective deterrent to communist expansion.
If Singapore were to fall to communist control the power of the West to influence events in Burma, Thailand, Indonesia, Laos, Cambodia, and Vietnam would be greatly reduced. Indeed, the US position throughout the Far East would be profoundly altered to the detriment of our interests.
There is still time for remedial measures in Singapore even though the communists have had greater success in their subversive efforts in the Colony than they have had in the Federation. Long-range remedial plans must be developed to supplement present reliance on police power. The stakes are sufficiently great to justify a strenuous attempt to reduce the inroads made by communism and, conversely, to build up anti-communist strength.
It is in the interest of the United States to attempt to stimulate the British authorities to develop a thorough, positive, and comprehensive plan of action to counter subversion in Malaya.
Where it is clear that the British and the Malayans lack the resources, facilities, or abilities successfully to oppose communist efforts, the US should give the most sympathetic consideration to their requests for assistance, although we must always be mindful of the danger of appearing to support “colonialism”.

. . . . . . .

VII. Recommended Courses of Action


Approach the British at a high level in an effort to persuade them to undertake a comprehensive counter-subversive program in Malaya. The first opportunity for such an approach would appear to be for the Secretary of State to talk either to Foreign Minister Macmillan at the NATO Council meeting scheduled for December 15 in Paris or to Prime Minister Eden during his anticipated visit to the US.5 (A draft “talking paper” for the Secretary’s use is attached as an appendix.6)

. . . . . . .

Action: State.


Complete preparation of detailed suggestions7 to be used as a basis for working-level discussions with the British after the initial approach by the Secretary described above.

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Action: State, ICA, USIA, Defense, … (joint working group already working on this problem).


As soon as the British have indicated an interest in receiving our detailed suggestions, provide them on a working level in Washington, London, and Singapore with specific detailed suggestions. If no British response is forthcoming after the original high-level approach, the US should take the initiative in further approaches.

Action: State, supported by ICA, USIA . . . .


Urge American labor organizations to continue to encourage the ICFTU to strengthen its office in Singapore and to provide assistance to the STUC.

Action: State.


Increase our exchange-of-persons program in Malaya.

Action: State.


Stand ready to consider financing, from the Asian Economic Development Fund, projects proposed by the Federation and Singapore which are of a regional nature.

(Note: It was recognized, however, that the usefulness of technical or economic assistance to Singapore or the Federation is dubious unless such assistance is extended under conditions which minimize to the greatest possible degree the possibility that the US would be accused of supporting British colonialism and unless in concert with other action providing reasonably secure conditions and the time needed for projects to have an effect. Also in view of Malaya’s favorable balance of trade, it appears that such assistance would have to be justified on other than economic grounds.)

Action: State/ICA.


Through the Consulate General in Singapore continue to urge the officials of the University of Malaya and the Singapore Polytechnic into prompt presentation of a request for technical assistance within the context of US conversations with Sir Sydney Caine last summer and in accordance with informal conversations between the British and US delegations to the Colombo Conference in Singapore in October 1955.

Action: State/ICA.


Continue our present USIS program in Malaya at least at its present level and reorient it as USIA may consider appropriate to counter particular communist successes.

Action: USIA.

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(Note: State, ICA, Defense and … concur in this recommendation.USIA withholds its concurrence from recommended action “H” and proposes the following wording as an alternative: Continue our present USIS program in Malaya.)


Through normal diplomatic channels seek to make certain that leaders of free Asian governments are apprised of the gravity of communist subversion in Malaya.

Action: State.


Stimulate further direct contact and exchange of views between Malayan and Philippine officials on such questions as combatting communist subversion and terrorism, encouragement of non-communist labor unions, and the establishment of a sound public school system in a multi-lingual society.

Action: State.


Support the British in their anticipated approach to the Thai Government for more vigorous joint Thai-British action against the communist terrorists in the Thai-Malayan border area.

Action: State, . . . .


Seek to persuade the Australian Government to approach the UK separately in support of our view that prompt counter-subversive action is required in Singapore and Malaya.

Action: State, . . . .

  1. Source: Department of State, OCB Files: Lot 61 D 385, Singapore and Malaya, Documents. Secret. The interdepartmental committee included representatives of the Department of State, the Department of Defense, the Central Intelligence Agency, the U.S. Information Agency, and the International Cooperation Administration. The study was considered by the Operations Coordinating Board at its regular meeting on December 14. A background note, prepared for the users of the study, pointed out that a working group on NSC 5405 and NSC 5503 was drafting possible courses of action with regard to the overseas Chinese in Singapore and Malaya which might be brought to the attention of British officials if they proved responsive to the more general approach outlined in the study. For information on NSC 5405, see Document 441. For text of NSC 5503, “U.S. Policy toward Formosa and the Government of the Republic of China”, January 15, 1955, see vol. II, p. 30.
  2. Reference is to paragraph F in Section VII, below.
  3. A covering memorandum by the OCB Secretariat Staff, January 5, 1956, indicates that the Board approved the first recommendation.
  4. In February 1954, a commission chaired by Sir George Rendel recommended constitutional changes for the colony of Singapore, including, inter alia, the establishment of a popularly-elected Legislative Assembly. The recommendations were accepted by the Colonial Secretary and the first election under the new constitution was held in April 1955.
  5. The Secretary waited until the EdenLloyd visit to raise the issue with Foreign Secretary Lloyd on January 31. For a report of their discussion, see Document 451.
  6. Not printed.
  7. See CA–5294, infra.