106. IMMEDIATE SECRET
1. It is the hope of the Australian Government that the Consultative Committee meeting in Sydney will reach agreement on2—
(a) objectives of long term development programme for South and South East Asia and on arrangements to begin immediately to prepare such a programme on the assumption that international financial assistance will be forthcoming.
(b) Immediate although much more limited measures to be taken by Commonwealth countries collectively to provide assistance to the area.
(c) Method of approach to the United States and possibly France and the Netherlands to associate them with these immediate measures pending the evolution of long term plans on a more comprehensive scale.
2. In connection with 1 (b), Commonwealth countries have already made contributions to assist the area. The Australian Government believes, however, that a greater effort is possible and that if this effort is made as a collective organised programme it will in itself not only satisfy urgent requirements but also contribute towards success in 1 (a)� that of organising a more comprehensive and consistent programme on an international basis. It will be demonstrated to the United States—
(a) that initiative is being taken in the area itself involving some degree of self help
(b) that Governments other than the United States including countries in the region are prepared to share the burdens.
3. The Australian Government proposes that Commonwealth Governments agree at Sydney to establish a Commonwealth fund for three purposes—
(a) Provision over three years of technical assistance in all its forms (e.g. training facilities, personnel, supplies) which should aim to train in all about 3,000 Asians and provide up to 1,000 technical experts, instructors etc., and equipment costing in all 8m. sterling.
(b) Provision of emergency relief in the form of medical supplies and food over the course of three years. (A sum not exceeding 4,000,000 pound sterling is envisaged for this purpose).
(c) Stipulation of an agreed sum up to which Commonwealth Governments individually or, where appropriate, collectively would consider negotiation of credit arrangements with particular countries in South and South East Asia urgently needing such assistance for the provision of high-priority imports. It is suggested that the amount pledged by the Governments for this purpose might be available over a two year period.
4. The Australian Government would suggest that contributions should not be tied to expenditure in the contributing country but should be available for use in soft currency areas. It would be desirable to endeavour to make arrangements with Governments of European and other countries with facilities available for the provision of services at the expense of the fund.
5. The Governments would create a Commonwealth Council of all contributing Governments to administer the fund and a secretariat and small staff of seconded technical officers, the functions of which would include—
(a) Consultations with potential recipients of aid with a view to working out a programme in consultation with other international organisations and the United States and other Governments for implementation by the contributing Governments.
(b) Establishment of conditions where appropriate for the provision and supervision of aid.
(c) Provision of a corps of experts available to assist Governments in the area to prepare long term development plans upon a uniform basis.
(d) Circulation to Commonwealth Governments of economic information about the area.
6. The Australian Government believes that a fund of 8,000,000 pound sterling would be sufficient for the technical assistance part of the programme. So far as concerns the sums stipulated as available for the credit negotiations with countries in the area the Australian Government does not wish to suggest a precise figure at this stage but (? perhaps) this question will be the subject of discussion at the Sydney meeting. Clearly it can only be a limited figure designed to provide first aid of utmost importance to the recipient Governments.
7. The Australian Government is anxious to avoid the creation of unnecessary machinery. But it is our judgement that establishment of limited machinery additional to the normal channels of Commonwealth consultation would be a necessary adjunct to the practical aid programme envisaged in order to provide the basis from which to work to a wider system of co-operation with other Governments which might later be brought to join as contributors. Moreover the Commonwealth Secretariat working with potential recipients on behalf of the Commonwealth Governments collectively could more effectively negotiate co-ordinated arrangements for assistance by individual Commonwealth contributors taking account of all other current sources of aid.
8. It would be appropriate and desirable for the fund to include any existing bilateral arrangements under which technical or other aid is afforded by individual Commonwealth countries to other countries in the area. Provision should be made within the machinery to maintain whatever degree of individual control over such existing arrangements as might appear to be appropriate to the countries involved. The figures tentatively suggested in paragraph 3 above are of course intended to provide for a net addition to such arrangements.
9. The technical staff of the proposed Council would provide one of the essential requirements for organising the presentation of a practical and co-ordinated longer term plan of development of the area. Its relationship with Economic Commission for Asia and Far East in this respect would require careful consideration.
10. The Australian Delegation will be glad to offer the Sydney meeting an elaboration of the proposal outlined in this telegram.
[NAA: A3320, 3/4/2/1 part 1]