DEFENCE CO-OPERATION 1. With reference to your letter No. 47/1948 dated 2th May 48 , the Strategical Appreciation by the Australian Chiefs of Staff , together with the Conclusions of the Council of Defence thereon  is being examined by the United Kingdom Chiefs of Staff. In this connection the first draft report has been prepared by the Joint Planning Staff who have invited Commander Walton  to attend their next meeting when the draft is being re-examined.
2. Pending consideration and acceptance by the United Kingdom Chiefs of Staff of the report in its final form, a tentative forecast of the main issues which may be raised by the United Kingdom for further discussion with Australia is given in paragraphs 3 to 7 hereunder.
3. There is apparently no conflict of opinion on any matter of substance between the Chiefs of Staff of the two countries, but it appears that the Australian Government considers that planning on a bilateral (or trilateral, if New Zealand is included) basis should be confined to the Australian Area of strategic responsibility. This appears to preclude any Australian contribution in the Middle East.
4. Moreover, while it is agreed that planning at the official level will not commit the Governments concerned in advance, it is considered that any plans agreed between the Chiefs of Staff can be of no real value until their respective Governments have approved of them. Such approval, while in no way committing the Governments to go to war, will commit their countries to carrying out the agreed plans should they be allied in war.
5. It is appreciated that, in a war between the Anglo-American powers and Russia, no direct threat to Australia will develop until the enemy has had outstanding success in Europe and the Middle East. Since it can be assumed that America will be in the war from the beginning, any commitment that may arise in the Pacific will in any case be fully covered by her.
Retention of the Middle East Area, therefore, is more vital to the security of Australia-at least in the early stage of a war-than South East Asia; consequently, an Australian contribution in the former area would best help to secure the Australian continent.
The Australian Government should, therefore, be persuaded in its own interests to extend joint planning to cover the Middle East, and not to bar in advance the possibility of an Australian contribution in that theatre. (Paragraph 86 of the Australian Chiefs of Staff Appreciation refers.)
6. Although the extent to which Australia can be responsible for the physical defence in war of her zone of strategic responsibility is dependent on her available resources, the responsibility for initiating and guiding Commonwealth planning for the area need be governed by no such consideration and Australia win probably be asked to accept this responsibility 7. The boundary of the zone suggested by the Australian Chiefs of Staff does not go as far north as that approved by the United Kingdom Chiefs of Staff as a basis for discussion in 1947 and does not include Hong Kong. Since it is considered an Commonwealth Pacific possessions should be included, it is suggested that Australian agreement to extending the area at least to include this port should be obtained.
Furthermore, it is considered that Australia and New Zealand should be asked to agree to pool their resources for defending this area, thus avoiding the undesirable arrangement of having two separate zones of strategic responsibility in the Pacific.
8. As I expect to be invited to attend the United Kingdom Chiefs of Staff meeting when the final report of the Joint Planning Staff on this subject is being considered, I shall be glad to receive early direction on the matters mentioned in the preceding paragraphs.