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57 Minute from Wheeler to Fadden

Canberra, 3 May 1950

Aid to South and South East Asia Proposal for Commonwealth Fund

On 22nd March 1950, Cabinet Committee on Aid to South and South East Asia approved, inter alia, that the Minister for External Affairs should at the coming meeting of British Commonwealth representatives in Sydney on 15th May, have freedom to negotiate with them for Australia to undertake commitments up to an overall limit of �A13m. (including loans made available by the Commonwealth Bank on a banking basis) in pursuance of Government policy towards S.E. Asia.1 This was stated to be:—

Deliberately increased commercial relations, financial assistance in co-operation with U.S.A. and other countries,

Training and technical assistance, and any other forms of assistance which will help to stabilise conditions in South East Asia and promote Australian economic and security interests.

2. Following this decision the Department of External Affairs have drawn up a suggestion for the establishment of a Commonwealth Fund to which British Commonwealth countries would contribute in the first place, and later on other countries interested in the area. This Fund would include contributions for technical assistance, emergency relief supplies and credits. �A10m. would be for a three-year programme of technical assistance, �A5m. for emergency relief supplies and �A30m. for credits for high- priority imports over a two year period.

3. To administer this fund there would be a Commonwealth Council and under it a Secretary and a small staff.

4. Although this scheme has been considered as far as present knowledge and circumstances permit, it is impracticable to apply normal standards of judgment because so many important factors are unknown and the scheme is essentially political in character. It must be regarded rather as a starting point for further action, and as a political gesture, symbolic of future intentions.

5. The Minister and Department of External Affairs wish now to give notice of their intention to bring the plan for a Fund before the coming meeting in Sydney to the Governments of the other countries concerned. They have submitted the attached telegram outlining their plan for your consideration,2 and desire your approval before it is despatched.3 (The figures in the telegram are expressed in terms of sterling).

[NAA: A1838, 708/9/2 part 2]

1 See Document 44.

2 The attachment was a draft of Document 58.

3 Fadden commented in marginalia: 'I think that the proposals are within the authority given by Cabinet Committee. But as mentioned in our discussions last night I feel it necessary to make clear that the 'spectacular approach' being adopted does mean that ordinary business tests will inevitably fall by the wayside to some extent because of political factors. Of course this may be desirable from an overall point of view. 1 would also add that in fact [part?] [indecipherable]. This means a continuing commitment [sic]'.

Last Updated: 10 January 2017

Category: International relations

Topic: History