Economic Assistance to South and South-East Asia
1. In preparation for the forthcoming meeting of the British Commonwealth Consultative Committee in May we urgently need as much detailed information as possible concerning the economic situation of the area of South and South-East Asia,—the countries concerned for this purpose being India, Pakistan, Ceylon, Burma, Siam, Indo-China, Malaya and Netherlands.
2. While a large amount of general descriptive information is available, it is difficult to obtain up-to-date and reliable information in quantitative terms which would enable us to calculate a country's stability and ability to finance essential imports.
3. One immediate problem for instance is to get sufficient rough information in order to determine, in relation to financial assistance:—
(a) the extent to which Commonwealth countries could be expected to make any contribution towards solving the problem of South and South-East Asia.
(b) the relative importance of Dutch and French participation in Indonesia and Indo-China respectively.
(c) the extent of dependence on aid from U.S. sources, either Government, International Bank or Export–Import Bank.
4. We already have a copy of the International Monetary Fund document 'Intra-Regional Trade of the ECAFE countries' (R.D. 916).1 Through Treasury we are asking if Mr.MacFarlane2 can obtain an additional copy. We have also asked that he furnish any more up-to-date information which may now be available to the Fund. We suggest that Plimsoll33 keep in touch with Mr. MacFarlane on this, bearing in mind that we are trying to obtain enough relevant information to enable us to make a rough guess as to the order of magnitude of external assistance required by the South and South-East Asian countries on an annual basis, on the following assumptions:
(a) a minimum 'viability basis', with a fairly modest rate of capital investment, and an expended rate of intake of consumption goods (e.g. food and textiles) in those areas where deficiencies can be regarded as serious or where incentive goods are urgently required for production.
(b) that export and import prices remain much as they are.
5. It also occurs to us that State Department economists are probably working along similar lines on various general studies of the area in an attempt to estimate the urgent needs. It is requested that Plimsoll endeavour to maintain a close liaison with the State Department and furnish as much relevant information on the general problem as the State Department is prepared to give. It would be particularly valuable if we could be assured of receiving, in due course, the information collected by the Griffin mission to South-East Asia.4 The Minister desires us to keep the U.S. Embassy, Canberra, fully informed concerning developments in connection with the Consultative Committee and it is possible that from time to time specific requests for information will be made of the U.S. Embassy here. However, you will appreciate that it is difficult for the U.S. Embassy to supply quickly any background economic information and you should accordingly feel free to endeavour to obtain by your own efforts as much relevant information as possible.
6. It was reported in the press on March 7th that, according to Burmese Embassy officials in Washington, Burma has asked the United States for economic assistance. It may be possible to find out what form this request took and what specific type of economic assistance was asked for. Details should be furnished where possible, of any similar requests by other countries in the area.
7. At the present time, in all economic reporting from Washington, first priority should be given to keeping us informed in as much detail as possible on all questions which have any bearing on aid to South and South-East Asia.
[NAA: A 1838, TS708/10/1]