218. Intelligence Note From the Director of the Bureau of Intelligence and Research (Hughes) to Secretary of State Rusk 1

No. 501

SUBJECT

  • The Indonesia-Malaysia Accord: Possible Pitfalls Ahead2

The signing of the Bangkok Accord in Djakarta on August 11 ends Indonesia’s military confrontation of Malaysia, but Indonesia’s interest in dismembering Malaysia remains active and there are still obstacles to stable relations.

Terms of the Accord. The terms of the Bangkok Accord, negotiated by Malaysian Deputy Prime Minister Razak and Indonesia’s Foreign Minister Malik at the end of May, are brief and simple. The tone is set by the reference in the opening phrase to “the brotherliness” between the peoples of Indonesia and Malaysia “bound together by history and culture from time immemorial.” In Article One, Malaysia agrees to a reaffirmation by the people of Sabah and Sarawak “in a free and democratic manner as soon as practicable through general elections” of “their previous decision about their status in Malaysia.” In Article Two, Indonesia and Malaysia agree to resume diplomatic relations and exchange diplomatic representatives. And, finally, in Article Three, both countries agree that “hostile acts between the two countries shall cease forthwith.”

Secret Letters. Although Malaysia promptly accepted the Bangkok Accord, Sukarno refused to sign it. As an inducement to Sukarno, General Suharto in June proposed an exchange of secret letters with Malaysia at the time of the formal signing of the Bangkok Accord. These would delay implementation of Article Two until Article One had been carried out; in other words, de jure establishment of diplomatic relations would have to await the elections in Sabah and Sarawak. With [Page 464]considerable reluctance and after the exchange of many draft letters, the Malaysian government agreed.

It seems doubtful that the secret letters will remain secret for long. Neither government however seems to fear that public disclosure, if it occurs, will undermine its ability to portray the Bangkok Agreement as a national victory: for Kuala Lumpur a victory in bringing about Indonesian recognition of Malaysia and for Djakarta a victory in bringing about a reascertainment in Borneo.

The Promise of Reascertainment Could Cause Problems. The reaffirmation provision is one that the Malaysians found it very difficult to accept. Initially they were given to understand by the Indonesians that the requirement was pro forma; in exchange for inclusion of the commitment in the agreement, Indonesia would refrain in future from insisting that it be implemented. In subsequent negotiations, however, it became clear that the Indonesians had shifted from this position and regarded an actual reascertainment as indispensable. Present Malaysian expectations, bolstered by the language of the agreement, are that the requirement can be satisfied by a question on the ballot at the next regular election in each state that will, in effect, produce an endorsement of the existing situation.

Nevertheless, the promise of reascertainment may bring political rumblings within Malaysia. As far as is known, political leaders in Sabah and Sarawak were not consulted. Indeed the Chief Minister of Sarawak, upon hearing the rumor that the Bangkok Accord provided for a reascertainment, announced that he would not allow such a question to be put on the ballot in his state.

In addition the date of the elections could be controversial. Indonesia wants them held as soon as possible. Although Razak has said they will be held “next year,” Malaysia is not necessarily prepared to act very quickly. Elections are not mandatory in Sabah until mid-1969 and in Sarawak until mid-1968. While there are domestic political reasons why an election might be held in Sabah in 1966 or 1967, there is serious doubt that electoral districts could be delineated and voter lists compiled in time for an early election in Sarawak. More compellingly, it is unlikely that Kuala Lumpur, which only this June put the present government of Sarawak into power by somewhat questionable means, would want that administration tested in an early election.

Quite apart from the question of timing, other issues may make the reaffirmation provision a troublesome one. Indonesia, where interest in dismembering Malaysia is by no means confined to Sukarno, is already supporting dissident Sabah and Sarawak politicians and is stepping up the infiltration of agents into both East and West Malaysia. Moreover, there are indications that Indonesia may request observers at the elections. If it does so, the Malaysians, recalling the problems over observers [Page 465]for the UN survey in August 1963, may be reluctant to comply. There could be disagreement on this point and delay while the question is settled, or Indonesia could use the absence of observers as a pretext to denounce the results of an election just as it denounced the UN survey.

Whether either side will refrain from exploiting the ambiguities of the reaffirmation procedure to make difficulties with the other, will depend heavily on the survival of conciliatory attitudes in Kuala Lumpur and Djakarta. Kuala Lumpur must continue to see the advantages of obtaining Djakarta’s full formal recognition of Malaysia’s sovereignty within present territorial limits as outweighing distaste for going through even the motions of a reaffirmation and overlooking the clandestine activities the Indonesians seem intent on maintaining. Restraint in Djakarta on the other hand, may be closely tied to the calculation that prospects for substantial economic assistance from the West are significantly related not only to the termination of military confrontation but also to the maintenance of normal and amicable relations with Malaysia.

  1. Source: Johnson Library, National Security File, Country File, Indonesia, Vol. VII, Secret; No Foreign Dissem; Controlled Dissem.
  2. The CIA’s Office of National Intelligence prepared a memorandum for the Director, August 16, entitled, “The End of ’Confrontation:’ The Debit Side,” which concluded that although the end of confrontation would eliminate the threat of open warfare between Indonesia and the British Commonwealth and allow Indonesia to concentrate on economic affairs, it would also lead to increased Indonesian political influence in Malaysia and progressive diminution of British political and military influence. These developments would alter Malaysia’s pro-Western orientation, and increase tension between Malays and Chinese. Although Indonesia gave up efforts to subvert Malaysia, it would not abandon its long-term goal of becoming the dominate power among peoples of Malay blood. (Ibid.)