On December 25th Doctor Shafrudin Prawiranegara, Republican Minister for Economic Affairs broadcast a radio message from 'somewhere in Sumatra'. In this broadcast which was relayed by several stations in South-East Asia, Shafrudin announced the formation of a Republican Emergency Government and outlined the following conditions under which this Government would agree to issue a cease-fire order and resume negotiations with the Dutch (a) immediate release by the Dutch of the Republican Government;
(b) Withdrawal of the Dutch forces to positions of December 18th;
(c) Recognition of the Republic's de jure and de facto sovereignty over Java, Sumatra and Madura;
(d) Establishment of a democratic and independent Indonesian Government 'without Dutch intervention';
(e) Withdrawal of all Dutch forces from the whole of Indonesia as soon as possible.
2. This fits in with the information given me by Hatta on December 19th that authority would be given for the establishment of an emergency Government in Sumatra. Shafrudin is the logical leader of such a Government.
3. Official Dutch reactions in Batavia are that Shafrudin's conditions are 'of course not discussable'.
4. Republican sources claim that the Dutch have encountered considerable guerilla resistance in their advances into Bandas  and that Republican administration of Bandas is carrying on in the woods in conjunction with TNI. The Committee's military observers are unable to confirm this.
5. Military observers believe that the Dutch have now achieved their main objectives. This means that they have completed their advances along the main roads and taken the main towns throughout Java and most of Sumatra. They could therefore issue a 'cease- fire' order without embarrassment and describe any future operations as internal security measures. For reasons indicated in the Committee's latest report  to the Security Council such a cease-fire order could not be effectively observed.