For Minister for External Affairs. Personal and most secret.

At opening speech of Conference [1] I indicated that Australia
would welcome regional pact in Pacific and would be prepared to
collaborate with other Powers to this end. Words used were
precisely those of Cabinet Committee report on sanctions and as
used in Senate and Representatives in September last. [2] Proposal
aroused great interest both in Conference and generally and when
Far Eastern questions were reviewed by Conference Australia was
asked to elaborate the idea in a memorandum. Memorandum [3] dealt
with interest of Commonwealth Government in this question and
quoted cable sent to United Kingdom Government in March [4] on
advisability of Anglo-Japanese rapprochement as starting point for
general Pacific settlement. Proposal was generally agreed on by
Conference as being politically desirable and question was
referred to Committee for examination.

At conference Tuesday last it was agreed [5]-
(1) that Pact covering territories in and bordering on Pacific was
a desirable objective.

(2) that Pact might embrace following-
(a) non-aggression including respect for each other's sovereignty;

(b) reaffirmation of renunciation of war as an instrument of
national policy;

(c) provision for political collaboration on lines of provision in
Quadruple Treaty or lesser degree of collaboration in Nine-Power
Treaty.

(3) that United Kingdom, Canada, Australia, New Zealand, United
States, Japan, Soviet Union, China, France, the Netherlands,
Portugal and Siam might be approached with view to participation.

(4) that United Kingdom Government be asked to take initial steps
to sound United States, Japan and China and should have discretion
as to time and manner of doing so.

At conference need of absolute secrecy and need of proceeding
cautiously were stressed, as it would be fatal to success if any
Power thought it was being presented with any cut and dried
scheme. Incidentally economic questions or economic collaboration
will be avoided as such matters will only complicate issues and
jeopardise political agreement.

I have had personal assurances of readiness to co-operate by
Ambassadors in regard to Netherlands [6], Russia [7], France [8]
and China. [9] United States Ambassador [10] said the United
States would not enter into any commitment of mutual assistance
but would no doubt be prepared to co-operate on lines of non-
aggression pact indicated by me. Japanese Ambassador [11] also
requested an interview yesterday and was most friendly and
sympathetically interested in proposal. I said I had done what I
could to launch idea and he should now discuss with Eden. [12] He
readily agreed to do this and said an Anglo-Japanese understanding
was his main objective.

Until you receive some idea from me as to nature of any public
announcement being made on proposal I would urge no public
statement whatever.

LYONS