281 Department of External Affairs to Critchley

Cablegram 286 CANBERRA, 18 October 1948, 3 p.m.

Your No. K.174.

You will have realised that our line has been to put the responsibility on the United States for persuading Dutch reasonableness in negotiations. We have made it clear that we would use all our influence on the Republic to accept any reasonable terms once the Dutch had shown signs of real intent to make an agreement.

2. We have been following this line because reference back to Security Council have not achieved any results and American financial and other influence is stronger than any threat of reference to the Security Council. In that sense it is therefore defeatist for the Committee to be drafting a report for the Security Council, and you should do everything possible to convince the United States representative on the Committee of his personal responsibility in keeping the pressure on his Government to persuade the Dutch to resume negotiations and to come to an early satisfactory agreement.

3. In order that we can assess the possibilities of agreement and decide at what stage we should approach the Republic, we should be kept informed of the precise terms of any Dutch counter proposals.

These proposals have to be considered in relation to immediate moves the Dutch might be willing to make, such as we have suggested to the United States, including the lifting of the blockade, a satisfactory arrangement over E.C.A.F.E. and other matters of current interest to the Republic.

4. Please report fully De Ranitz's present personal view of the situation.

[AA:A1838, 854/10/4/2, vii]