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

494. Despatch From the Embassy in Thailand to the Department of State¹

No. 644

Bangkok, May 23, 1956.

REF

• Embassy Despatch 507, March 21, 1956²

SUBJECT

• Assessment of Recent Thai Contacts with the Chinese Communists

In the reference despatch, the Embassy summarized a considerable number of intelligence reports indicating that during the period December 1955 to March 1956, certain Thai were in contact and negotiating with Chinese Communist officials. That these contacts were made with the knowledge and consent of Police Director General Phao Sriyanon and the then Deputy Prime Minister Phin Chunhavan is asserted by many of the intelligence reports and can be concluded with virtual certainty from some of the circumstantial evidence involved. This conclusion rests primarily on the following facts and considerations:

(1) That MP’s Amphorn and Sa-ing, who went secretly to the Chinese mainland in December 1955 and returned in February 1956, had, by their own admission, been proteges of Phao in the past; that Luen Buasawan, principal financial agent and political manipulator for Phao and Phin, told an Embassy officer that he had financed their trip abroad, although alleging that he did not know they were going to the mainland (Embassy Despatch 532, April 4³).

(2) That Amphorn and Sa-ing, who upon their return to Thailand on February 11 gave the press glowing accounts of conditions in Communist China, were not taken into custody until March 5 and were shortly released on bail. Police charges of their having violated the Anti-Communist Activities Act were recently dropped altogether. On the other hand, another group of MP’s, led by Thep Chotinuchit, which returned on February 17 from a public visit to the China mainland, was immediately arrested by the police, has been in custody ever since, and is now being prosecuted under the Anti-Communist Activities Act. The public statement of Amphorn and Sa-ing were almost as favorable from the point of view of the Chinese Communists as were those of the Thep group. The principal charge that the Government is bringing against the Thep group—that they served Communist propaganda purposes—would apply equally to Amphorn and Sa-ing. The fact that the charges against Amphorn and Sa-ing have been chopped, whereas the Thep group is being prosecuted, therefore indicates definitely that Amphorn and Sa-ing are being given special protection, in all probability because their trip was sponsored by Phao and Phin.

(3) That Luen Buasawan admitted to an Embassy officer on March 13 that he was negotiating with Chinese Communist agents for the sale of Thai rice, although asserting that he was doing so on his own initiative and without Phao’s knowledge (Embassy Despatch 532).

(4) That Luen’s relationship with Phao and Phin was so close as to preclude the possibility that he would have undertaken such a major step as these negotiations, or financing the China trip of Amphorn and Sa-ing, without at least the tacit consent of Phao and/or Phin. (Embassy Despatch 562, April 17.⁴)

The balance of the intelligence cited in the reference Despatch serves for the most part to supplement and support the points outlined above. In addition, there are other considerations which, although not conclusive in themselves, help to put in perspective the recent maneuverings of Phao–Phin vis-à-via the Chinese Communists.

Before mentioning these considerations, however, it should be borne in mind that Marshal Phin, who is Phao’s father-in-law, and Phao have for some years been the leaders of a political clique, based in part on family relationships, which has competed for power within and sometimes dominated the ruling oligarchy of the Thai Government known as the “Coup Group”. The Phao–Phin clique has had its ups and downs, and the latest turn in its fortunes is Phao’s emergence from the political eclipse which he suffered (just as he was reaching for supreme power) at the hands of Prime Minister Phibun beginning in August 1955 (Embassy Despatch 126, September 7, 1955⁵). The key members of the Phao–Phin clique have operated as a unit; it is generally accepted that when any one member of the clique acts on a matter of political significance, the other principal members have been consulted and approve.

Throughout at least the latest years of Phao’s political career, he has demonstrated a strong tendency to maintain contact with a great variety of political elements, both domestically and in neighboring countries. While Phao’s operations in this regard have seemed frequently erratic and impulsive, they appear to have been governed by the idea that it is desirable to be in contact with, or to have some leverage over, as many political elements as possible of present or potential utility. While such tactics are not out of keeping with Thai political tradition, Phao has pursued them with unusual initiative and energy. Political self-interest is apparently the dominant motive, and, although Phao may equate this with the national interest, it has led him into ventures which were highly irresponsible from the point of view of national policy.

One illustration of Phao’s political expediency is particularly pertinent. The Embassy’s limited records reveal that in 1952 and early 1953 there was a series of developments indicating that Phao at that time was cultivating active supporters of Pridi Phanamyong, former Thai Prime Minister, who had only recently sought refuge in Communist China. The evidence of these contacts was not conclusive, but the Embassy at that time apparently accepted it as probably accurate and in character for Phao, and allowed for the possibility that Phao was even maintaining contact with Pridi himself. What Phao hoped to gain is problematical. It may be that he wished merely to win over Pridi supporters within Thailand to his own camp. Perhaps in addition he had in mind the possibility that it could be useful to have available a channel of contact with Pridi in the event that Peking’s strength and influence should continue to increase.

It is not altogether surprising, therefore, to find that three years later Phao has become involved in contacts with the Chinese Communists. Phao’s recent maneuvers become all the more plausible when one considers the political atmosphere in which they were initiated. For some months there had been developing in Thailand a considerable public interest in the possibility of improved relations with Communist China, including the establishment of direct trade. This interest was an outgrowth of international developments during 1955 signifying the relaxation of East-West tensions and which apparently led many Thai (and Chinese residents of Thailand as well) to conclude (a) that the growing prestige of Communist China required some kind of adjustment by Thailand in order to avoid being left in a position of splendid isolation, and (b) that it was foolish, in any event, for Thailand to continue to be one of the few free nations in the eastern hemisphere which refused to take advantage of trade opportunities with Red China. The latter conclusion was reinforced in the minds of the Thai by the apparent willingness of the United States to continue substantial economic aid to other allied and neutral governments irrespective of the attitudes maintained by those governments toward Communist China. These thoughts found expression in a wide-spread press campaign, made possible by the Prime Minister’s relaxation of censorship, which included attacks on alleged U.S. domination of Thailand, with particular reference to Thailand’s military burden, and criticism of the inadequacy of U.S. economic aid to Thailand (Embassy Despatches 373 and 374, January 11, 1956⁶). While the campaign was spearheaded by the left-wing press and exploited by opportunistic or pro-Communist fringe elements, it also had the active participation of independent organs and of newspapers controlled by key government leaders including the Prime Minister.

The Thai buttressed their arguments for trading with Communist China by exaggerated references to the difficulties of maintaining Thailand’s free-world markets for rice and rubber in the face of the U.S. surplus disposal program and of a prospective reduction in U.S. purchases of natural rubber. Despite belated but strong refutations of this thesis by the Prime Minister, many Thai and Chinese businessmen and editors continued to maintain that access to Communist China’s markets would be a remedy for Thailand’s present or anticipated economic difficulties. This view undoubtedly also reflected personal pecuniary considerations on the part of businessmen. The interest in direct trade with Red China appeared all the more intense, at times almost neurotic, because such trade was prohibited altogether (“distant fields look greener”). Much of the resulting frustration was directed at the U.S. which many Thai alleged was imposing the trade embargo on the Thai Government while at the same time reducing the normal markets for Thailand’s basic exports.

In this situation, Phao and Phin must have considered that they stood to gain in more than one respect by making contact with the Chinese Communists, and they may have persuaded themselves that they had nothing to lose. There was the possibility of negotiating a personally profitable rice deal at premium prices if the Chinese should be agreeable to paying in convertible currency. This would help to recoup the Phao–Phin finances, which, according to some reports, had been suffering for some time. Furthermore, trade talks with the Chinese Communists would demonstrate a friendly attitude which, in the view of Phao and Phin, could do no harm and might be useful insurance for their group, and perhaps the Thai Government, against the day when Thailand might have to enter into some sort of relations with Red China. While the Embassy does not know what contacts were made by Amphorn and Sa-ing in China, allowance should be made for the possibility that they held conversations with Pridi and/or high Chinese Communist officials. Such conversations, so long as they did not involve important commitments by the Thai, could also have been regarded by Phao–Phin as affording desirable political insurance. Finally, Phao may well have had in mind that his initiative in trade and possible other contacts with the Chinese Communists could pay dividends in terms of increased domestic political appeal. It should draw support for his political comeback from Thai and Chinese interested in trade for trade’s sake with Red China, from those who advocate a more independent foreign policy on purely political grounds, and possibly even from the considerable number of former Pridi enthusiasts in Thailand.

Although there have been other indications (aside from the recent Phao–Phin maneuvers vis-à-vis Communist China) of a lenient attitude by Phao and elements of the police toward Communists and pro-Communists in Thailand, there is no evidence that Phao himself is pro-Communist in an ideological sense. The Embassy believes rather that his actions are an extreme manifestation of the Thai political tradition of attempting, as a small nation, to maintain its independence by keeping in line with apparent trends in the international pattern of power. Phao has as much reason to be apprehensive of Chinese, and particularly Communist Chinese, power as other Thai leaders although he apparently is not so wise as others in his assessment of the risks involved in doing business with the Chinese Communists. It is possible that Phao may have considered that his actions in the latest instance were purely economic in character and without political implications. This would be surprising, however, for Phao knew that his moves represented a sharp departure from the long-standing political policy of the Thai Government against any direct trade arrangements with Communist China and, therefore, were by definition politically significant in demonstrating a willingness on the part of a powerful faction of the Thai Government to enter into relations with Communist China.

The question naturally arises as to the extent to which Prime Minister Phibun and other key Government leaders had knowledge of and approved the Phao–Phin contacts with Communist China. Judging by the opposition to trade with Communist China which the Prime Minister has evidenced both publicly and privately, at least until recently, it would appear that Phibun disapproved of the Phao–Phin maneuvers if he knew about them. It is most unlikely that Phibun and other government leaders were unaware of Amphorn and Sa-ing’s trip to Communist China and of Luen Buasawan’s negotiations, for Bangkok was full of reports of both developments, and such information can hardly have failed to come to the attention of Cabinet members concerned. Phibun told the Ambassador in late February and later the Secretary on March 6⁷ that he was being subjected to strong domestic pressure for trade with Red China. It is probable that Phibun was referring to the Phao–Phin maneuvers as well as to other developments. We will probably never know whether Phibun refrained from calling a halt to these maneuvers because he was powerless to do so, or because he had given them at least a tacit approval.

Whatever the Government’s position may have been in regard to the Phao–Phin maneuvers during the December–March period, the Government has now (as of May 11) openly acknowledged that it is considering the suitability of easing its embargo on direct trade with Communist China in non-strategic goods (Embassy Despatch 627, May 16, 1956⁸). Although there may be strong differences of view within the Government on this question, and although the outcome cannot now be foreseen clearly, it may be concluded that some of the factors which induced the Phao–Phin trade negotiations have brought the Government to this point. Current indications are that the Thai Government is no longer prepared to resist the pressure for trade with Communist China which arises primarily from the fact that the principal free-world powers (aside from the United States) are engaged in and urging expansion of such trade.

Such a decision by the Thai Government, even though confined to non-strategic goods, would, of course, have adverse consequences for U.S. interests in Southeast Asia. It would very probably be construed by Southeast Asians as representing an alteration in the hitherto uncompromising anti-Chinese Communist posture of the Thai Government. The establishment of direct trade would increase the prestige of Communist China in Thai public opinion, and particularly in the eyes of the Chinese communities in Thailand and neighboring countries, an increase which the Communists would be sure to exploit fully.

However, as the Embassy has already reported, it does not believe that the relaxation of trade restrictions would signify any intention on the part of the Thai Government to recognize Communist China so long as that regime is denied admission to the United Nations, nor would it indicate any weakening of Thailand’s strong pro-West position within SEATO. The Thai Government is fully aware of the threat and danger represented by Communist China and is far from eager to develop relations with that regime. Whatever adjustments it makes towards Communist China can be regarded as measures undertaken reluctantly and out of a sense of necessity.

Max W. Bishop

1. Source: Department of State, Central Files, 792.00/5–2356. Secret. Also sent to Vientiane, Phnom Penh, Singapore, Kuala Lumpur, Rangoon, Saigon, Hong Kong, and Taipei.
2. Not printed. (Ibid., 792.00/3–2156)
3. Despatch 532 provided a detailed account of the efforts of Luen Buasuwan to foster Thai rice sales to the People’s Republic of China. (Ibid., 492.9341/4–456)
4. Luen Buasuwan was killed in an airplane accident on March 31. In despatch 562, the Embassy staff assessed the political effect of Luen’s death and concluded that it was “a serious blow to the fortunes of the power group within the Thai Government which centered around Police Director-General Phao Sriyanond and Field Marshal Phin Chunhawan.” (Ibid., 792.00/4–1756)
5. Despatch 126 detailed cabinet changes and related political moves made by Prime Minister Pibulsonggram in August 1955 aimed “at redressing the political balance of power and checking the political advances of Police Director Phao Sriyanon.” (Ibid., 792.13/9–755)
6. Despatches 373 and 374 from Bangkok reported on this press campaign. (Ibid., 692.00/1–1156 and 792.5–MSP/1–1156, respectively)
7. Apparently a reference to Pibulsonggram’s conversation with Dulles on March 13. See Document 489.
8. Not printed. (Department of State, Central Files, 493.929/5–1656)