70 Prime Minister's Department to Mr S. M. Bruce, High Commissioner in London

Cablegram unnumbered 13 August 1940,

Your telegrams, 659 [1], 626 [2], 564. [3] New Caledonian nickel.

Position as we see it is as follows. Commonwealth Government on 30th July concluded contract with Le Nickel executed by Vois [4] under authority vested in him, but without knowledge of directorate in France, for purchase 450 tons matte per month.

Nothing had been done by Inco along lines suggested in your 564 and it was essential to take some action to maintain economic position of New Caledonia, and place it in position of having to rely on British support, thus encouraging those elements in population who desire to follow de Gaulle. [5] Reference in your 659 to '600 tons already contracted for' is not understood.

During discussions prior to signing contract, Vois, representative of Le Nickel, stated his company would not sell any additional matte to Japan or elsewhere. As he was acting without instructions from his company, Mr. Vois stated action taken by him could be justified as quantities in contract were necessary but not more than necessary to maintain essential Australian credits, economic stability and cost of Administration. Vois made the point that additional production would cause difficulties with Administration as external credits obtained would be compulsorily converted under existing law to credits in New Caledonian francs, future value of which Vois considers uncertain.

Letter dated 3rd August just received from Oughton [6], who is in Noumea, states licence to export 25,000 tons nickel ore to Japan has just been given to Japanese company in New Caledonia, although previously such licence had been refused. Oughton thinks Governor [7] shows 'exaggerated respect' for Japanese Consul [8] and says Governor told him (Oughton) he would remain under whatever official government might be lawfully constituted in France and had refused to declare New Caledonia free of Vichy Government.

Exact position in New Caledonia, particularly attitude of Governor, is somewhat confused and uncertain. Commonwealth official representative, B. C. Ballard, is leaving for Noumea aboard s.s. 'CAGOU' on 16th instant, and you will be kept advised of his reports on exact situation in colony.

1 Dispatched 10 August. See file AA:A981, Trade 87B, i.

2 Document 48.

3 See Document 48, note 3.

4 General Manager of Le Nickel Co.

5 Leader of the Free French movement.

6 Representative of the Chrome Co.

7 Georges Pelicier.8 Tokitaro Kuroki.

[AA:A981, TRADE 87B, i]