22 Department of External Affairs to Evatt

Submission CANBERRA, 31 March 1947

INDONESIA

The Cheribon Agreement leaves for discussion between the Indonesians and the Dutch questions of foreign affairs and representation and of trade and economic arrangements.

In order to obtain initiative it is necessary to develop much closer contact with the Republican authorities, and this should be done as soon as possible, i.e. before the Dutch-Indonesian talks on the matters mentioned take definite shape.

TRADE: Dutch, American and British interests are already in the field and obviously pressing their advantage. There is urgent need for a plan for Australian economic relations with the Republic covering trade, loans, technical assistance, etc.

REPRESENTATION: Sjahrir has now stated that he proposes to be represented in Australia by an Indonesian and not by Mr. Campbell.

However, he has asked Campbell to go to Java and undoubtedly his discussions with Campbell will have some influence on representation of the Republic in Australia, and quite possibly on Sjahrir's ideas about Australian representation in Java. This may not be altogether desirable.

It is suggested that the following steps be taken:-

(1) A personal representative of the Minister for External Affairs should be sent to make close contact with Sjahrir and his Ministers, and should be accompanied by an expert on trade.

(2) Sjahrir should be persuaded to consult through this mission with the Minister for External Affairs concerning Indonesian representation in Australia.

(3) A substantial loan should be offered to the Republic, (25 million?). This would strengthen Sjahrir's hand. Conditions might include employment of Australian advisers and technicians.

(4) Close liaison between the Department and the Indonesian representative should be maintained.

(5) In view of the influence of some of the Australian Trade Unions and bodies such as the Australian-Indonesian Association, arrangements should be made for obtaining full and continuous information about their ideas and activities.

(6) Confidential contact with selected newspaper men in Australia should be maintained with a view to ensuring proper presentation of events and policies.

It is recommended that arrangements be made to send immediately a delegation led by a representative of the Minister for External Affairs, and including representatives from the Departments of External Affairs, Treasury, Commerce, and Supply. [1]

1 An annotation on the submission reads in part: 'Discussed by Sec[retary] with Min[ister] 31/3. Principle approved.'

[AA:A1838/2, 401/3/2, i]