Foreign Relations of the United States, 1964–1968, Volume XXVI, Indonesia; Malaysia-Singapore; Philippines

259. Memorandum From the President’s Special Assistant (Rostow)¹

Washington, June 19, 1968.

MEMORANDUM FOR

• The Secretary of State
• The Secretary of Treasury
• The Secretary of Agriculture
• The Administrator of Agency for International Development
• The Director of the Bureau of the Budget

SUBJECT

• Aid to Indonesia

The President has approved the 1968 aid package for Indonesia described in the Freeman/Poats memorandum dated June 7, 1968.²

The President also authorized our mission in Djakarta to inform the Indonesian Government now that we will be prepared to consider in the fall another PL–480 agreement providing for 100,000 tons of rice and the equivalent of 80,000 bales of cotton yarn if such additional assistance appears feasible at that time.³

The President also approved Secretary Fowler’s recommendations⁴ that:

1. there should be continued pressure on other donors to come up with additional contributions to Indonesia 1968 aid requirement;⁵

2. we should count wheat next year as a part of the US aid contribution if this year’s emergency and experimental wheat program proves successful;

3. any additional pledges of rice or cotton in the fall will be clearly identified as 1969 aid; and

4. Treasury and AID should attempt to work out with the Government of Indonesia arrangements under which some part of the rupiahs generated by wheat deliveries can be set aside in a special fund to promote US commercial exports.

W. W. Rostow

1. Source: Johnson Library, National Security File, Country File, Indonesia, Vol. VIII, 6/67–6/68. Confidential.
2. See footnote 2, Document 258.
3. In telegram 186811 to Djakarta, June 20. (National Archives and Records Administration, RG 59, Central Files 1967–69, FN 1–1 INDON)
4. See footnote 3, Document 258.
5. On June 20, Rostow wrote Robert McNamara, then President of the World Bank, a letter describing President Johnson’s decision and reasons for maintaining the one-third formula. Rostow noted that both the United States and Japan were prepared to commit their $110 million (plus the additional $46 million in wheat from the United States), but the rest of the international community was lagging behind on their one-third, leaving a shortfall of about $30 million. Rostow hoped that McNamara and the Bank could help with the shortfall. (Johnson Library, National Security File, Country File, Indonesia, Vol. VIII, 6/67–6/68, [1 of 2].