68 Lt Col W. R. Hodgson, Secretary of Department of External Affairs, to Mr M. L. Shepherd, Secretary of Department of Defence

Memorandum 29 September 1937,

I am attaching, for favour of your consideration, a copy of a despatch from the British Consul-General at Batavia [1] relative to the possibility of linking Portuguese Timor with the British system of aerial communication.

I might add that the Commonwealth Government has been seized for some time with the desirability of precluding certain foreign interests from obtaining a predominant control over Portuguese Timor. To this end, it has in recent months actively interested itself both with the Government at Lisbon and at Dilli in endeavouring to protect and further the exploitation of an Australian oil concession held in Portuguese Timor. [2]

1 H. Fitzmaurice.

2 At the request of the Minister for Defence, Sir Archdale Parkhill, this memorandum and its attachment were referred to the Defence Committee, whose views were subsequently reported in Document 172.

Attachment

Mr H. Fitzmaurice, U.K. Consul-General in Batavia, to Mr A. Eden, U.K. Secretary of State for Foreign Affairs

Dispatch 130 (copy) BATAVIA, 2 September 1937 Received n.d. [on or before 29 September 1937]

CONFIDENTIAL

I have the honour to report that the Governor of Portuguese Timor (Major Neves da Fontoura), who passed through Java on his way to Dilli last week, had expressed to me his desire that air communication with Portuguese Timor might be established, preferably by a British line.

2. I received a visit yesterday from Mr W. Hudson Fysh, Managing Director of the Queensland and Northern Territories Air Services ('Qantas'), who is on his way to London to confer with Imperial Airways on matters of common interest. I accordingly told Mr Fysh of the desire expressed by Major da Fontoura, suggesting at the same time that recent developments in Timor might make the establishment of an air connection with Dilli of greater interest both to the Australian Government and to Imperial Airways than it had hitherto been.

3. Mr Fysh showed much interest and said he would mention the matter to Imperial Airways Limited in London. At his request, I have consequently furnished him with a short memorandum (copy enclosed) [1] on recent developments in Timor.

4. I have, as you are aware, lately advocated that the Government of Australia should, largely for strategic reasons, develop a closer contact with Portuguese Timor. An air connection such as Major da Fontoura desires would certainly serve to strengthen such a contact, and consequently appears prima facie likely to be in the interests of the Commonwealth Government, even if it may not offer any great prospect of immediate profits to Qantas.

H. FITZMAURICE

[AA : A816, 19/301/587]

1 Not printed.

[AA : A816, 19/301/587]