Foreign Relations of the United States, 1969–1976, Volume E–12, Documents on East and Southeast Asia, 1973–1976

104. Memorandum of Conversation, Washington, January 22, 1974, 1100–1130.¹ ²

Washington, January 22, 1974, 1100–1130

ASSISTANT SECRETARY OF DEFENSE
WASHINGTON, D.C. 20301
In reply refer to: I -20251 /74CT

MEMORANDUM OF CONVERSATION
SUBJECT: Call by U.S. Ambassador Designate to Indonesia (U)

PARTICIPANTS:

• Department of State
• David D. Newsom -U.S. Ambassador Designate to Indonesia
• Mr. Mark Dion - Desk Officer
• Department of Defense
• VADM Ray Peet - Director DSAA, DASD/SA
• RADM Thomas J. Bigley - Director, ISA/EAPR
• Mr. Walter B. Ligon - Director, Military Assistance, DSAA
• COL J. A. Briggs, Jr. - Chief, ISA/SA-PPF Division
• CAPT Robert A. Shaid - Asst for Indonesia, ISA/EAPR

Time: 1100 - 1130, 22 January 1974
Place: ASD/ISA Office, Pentagon

1. (S) US-Indonesia Law of the Sea (LOS) Positions.

VADM Peet presented the ISA backup papers for the call to Ambassador Newsom for his retention, which included a summary of opposing U.S. and Indonesia positions on LOS. VADM Peet and RADM Higley reiterated the U.S. policy of not providing courtesy notification to GOI for U.S. Navy ships which transit the Strait of Malacca (between Malaysia and Indonesia), as opposed to other Straits between GOI land masses for which the U.S. does provide oral courtesy notification. Ambassador Newsom was advised that the Chairman, Joint Chiefs of Staff was insistent on keeping applicable posts advised with regard to Indian Ocean deployments, but that information was to be treated as privileged information by the Embassy.

2. (S) US MAP Commitment to Indonesia.

VADM Peet acknowledged high level USG recognition of the importance of Indonesia, but noted that Indonesia was not a part of the total force concept. In that regard he noted Defense supports MAP for Indonesia in the $20 to $25 million range, but desires to maintain a balance with MAP requested for the Philippines. Ambassador Newsom asked if the USG did not in fact have a high level MAP commitment to Indonesia. VADM Peet acknowledged that there is a high level commitment, but being faced with Congressional pressure to reduce worldwide MAP, and the current Cambodia requirement to maintain a $325 million level, resources were insufficient to fully support commitments elsewhere. Ambassador Newsom was advised that although high level determination was made to provide $25 million to Indonesia in FY 1972 and FY 1973, amounts thereafter were to be dependent on future events in Southeast Asia. However, due to various factors, the GOI has viewed US commitment to be a constant $25 million level.

3. (U) Provision of Excess Defense Articles (EDA).

VADM Peet stated that Defense would be alert to provide EDA as in the past, but that new legislation requires certain charges to MAP for EDA which stem from CONUS assets.

4. (S) Sale of US DEs to Indonesia.

VADM Peet noted that we were fortunate to be able to provide four DEs of the same class for sale to Indonesia, but we were not ambitious to provide much mare than a Coast Guard-type capability for Indonesia. RADM Bigley informed Ambassador Newsom of the difficulties experienced thus far relative to Indonesian Navy maintenance of the first DE which was transferred last year.

NOTE: Defense backup material held by Ambassador Newsom requests that the Country Team keep a careful eye on the DE maintenance situation.

5. (C) MAP Support of Indonesian Police.

VADM Peet and Mr. Ligon noted that the question of MAP support for National Police projects, including the police portion of the “INDOCOM” project, was under review by the General Counsel. New legislation may dictate severe reduction of police assistance previously planned through MAP for a number of countries.

6. (C) Provision of C-130 Transport Aircraft.

The Indonesian case for additional C-130s was reviewed and VADM Peet stated that his effort to obtain five C-130Bs at a reduced cost from the USAF was not productive, due to valid USAF requirements for the C-130Bs. Mr. Ligon advised Ambassador Newsom that for the time being we would have to consider the new C-130Es at a flyaway cost of about $5.2 million each, with an annual increase in cost of about ten per cent.

7. (C) Foreign Military Sales Credit (FMSCR) for Indonesia.

In discussing whether FMSCR might be appropriate for Indonesia, VADM Peet noted the general USG policy to shift from grant to FMS (cash and credit). Mr. Ligon endorsed commencement of a FMS program for Indonesia. VADM Peet stated that a buildup of the Defense Liaison Group (DLG) staff would not be encouraged in relation to a FMS program, that such a program should be handled mainly in Washington, along with sending expert assistance to the field as required. Ambassador Newsom expressed concern that the addition of FMSCR might create a corresponding decline in MAP, and that we would need to consider the best method of transition “without breaking political china.” VADM Peet said that Defense would welcome some FMSCR for Indonesia, but that none was currently programmed for FY 1975, and we have a worldwide problem on enough FMSCR to meet the demand. In response to Ambassador Newsom’s proposal of the possibility of starting with a modest $25 million FMSCR program in FY 1975, VADM Peet noted the advantages of the “squeaky wheel theory.” COL Briggs reviewed the negative status of FY 1975 FMSCR for Indonesia as a result of recent State/Defense/OMB/NSC security assistance program review meetings. Ambassador Newsom indicated he would pursue matters further at State.

8. (C) Defense Liaison Group Organization.

VADM Peet, although acknowledging the desirability of keeping US military presence to a minimum in Indonesia, commented on the cost-effective problem of the temporary duty personnel requirements for Indonesian MAP.

He requested that Ambassador Newsom review the question of permanent versus temporary duty personnel from an efficiency viewpoint. Regarding relationships between the Chief, DLG and the Defense Attache, VADM Peet noted that such relationships needed to be viewed on a country-by-country basis toward what is best in each circumstance. Whether the Chief, DLG billet might properly be filled by a Brigadier General was also discussed. VADM Peet deferred to the Ambassador’s view from the field on this matter. On the question of DLG communications with CINCPAC and Defense, VADM Peet noted that he had not heard of any concern expressed since his last meeting with Ambassador Galbraith. He reiterated his desire that all interested parties be informed on cables pertaining to common issues. Ambassador Newsom recognized the need to speak, from the field, with a common voice and a common awareness

Memorandum of Conversation
Prepared by: CAPT R. A. Shaid, USN

Approved by:
[signed] Ray Peet
Date: 1/31/74

DISTRIBUTION:
ASD (ISA)
DASD (ISA/EA&PA)
DASD (ISA/SA)
DSAA
JCS (J-5)
CINCPAC (J-8)
CHUSDLG, Indonesia State Dept
AmEmb Jakarta
AD (3)
RC (2)

1. Source: Washington National Records Center, OASD/ISA Files: FRC 330–77–0054, Indonesia, 333, 1974, January 31. Secret. Drafted by Shaid and approved by Peet. The conversation took place in the office of the Assistant Secretary of Defense for International Security Affairs.
2. Newsom met with Department of Defense officials and discussed the Law of the Sea, military aid, and military liaison with Indonesia.