Foreign Relations of the United States, 1949, The Far East and Australasia, Volume VII, Part 1

856d.00/9–1649

The Netherlands Minister for Foreign Affairs (Stikker) to the Secretary of State ¹

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1. So far, the Round Table Conference (RTC) has done useful exploratory work, but it is only beginning to deal with substantive questions. The pace is slow. The Indonesians should not be hurried. If they want to move faster, the Netherlands are ready to do so.

2. The Indonesians are hyper-sensitive in matters of sovereignty, and inclined to sacrifice workable solutions to an excessive care of prestige. The Netherlands are constantly watchful not to hurt their feelings, but it must remain our fundamental purpose not to accept paper solutions which, in the aggregate or separately, are certain to bring about chaotic conditions in an exposed part of the world where the common interest of the western nations requires at least a modicum of stability and sound administration. To harmonize this preoccupation with full Indonesian sovereignty should not be too difficult so long as both parties avoid giving that notion an exaggerated meaning at variance with accepted standards.

3. There is a difficulty of a general character in the fact that the Indonesians are by nature particularly prone to press for more and more concessions, irrespective of the question whether a desirable solution is not sacrificed in the process of haggling.

4. The general method employed by the Indonesians to counter a proposal which for some reason they do not like is to allege the undesirable psychological effect the measure in question, if adopted, would have on their home-front. Reasonable debate becomes difficult in these circumstances.

5. It is at times difficult to discard the impression that an appreciable number of the Indonesians would not be averse from letting the RTC drag on and end in a stalemate in an attempt to force the Netherlands to transfer sovereignty at the end of this year without any settlement having been reached. It will be necessary to watch this dangerous tendency carefully.

The key to obtain a more cooperative attitude on these very important points on the part of the Indonesians, though nominally resting with UNCI, rests in point of fact with the United States Member. The Indonesians will remain difficult and distrustful, but it will make a very great difference when the United States Member of UNCI tells them that he cannot subscribe to their methods or to the stand they take.

It may be recalled in this connection that, especially in the earlier stages of the controversy, the Government of the Republic has always pressed for an arbitral decision. The reason was that they wished to be able to say to those of their followers who, like the armed elements, were disinclined to obey them, that they had done their best, but that a solution had been imposed on them by an agency other than the Netherlands. Similarly, any reasonable outside persuasion will strengthen the hand of the Republican Government, not weaken it.

In the eyes of the Netherlands Government, the art of diplomacy in this matter consists for all concerned in finding the boundary where recognition of the claims of Indonesian nationalism and generous concessions to those claims degenerate into solutions which, so far from promoting stability in this corner of South East Asia, sow the seeds of economic disruption and political disintegration.

Another failure in the negotiations would be a serious setback for the western powers in general and for the Netherlands in particular. It is not likely that, given the peculiar character of the Indonesians, it will be possible for the Netherlands without some outside help to avoid failure despite anything the Netherlands Government can and will do within the limits of a tense internal political situation and of the revised Constitution.

There are four specific areas of contention which will present serious difficulties:

1. Union. The Indonesians are very suspicious that the Netherlands aim at a super-state with powers of its own, so as to impair Indonesia’s newly won sovereignty.

The Netherlands have no designs of this nature, since for obvious reasons they are no more in favor of a super-state than are the Indonesians.

In the opinion of the Netherlands, the Netherlands–Indonesian Union is not to be a super-state, but a form of close cooperation between two independent sovereign states.

This Union must have machinery for consultation of ministers in equal numbers from both states and an interparliamentary consultative committee.

If a decision is arrived at in these consultative bodies, the governments remain responsible to their respective parliaments and not to any organ of the Union.

There should be a Union-tribunal for the amicable settlement of disputes between the partners to the Union. The judges are to be appointed in equal numbers by both states. In case of dead-lock, the President of the International Court of Justice should appoint one more member.

2. Finance. The Indonesians are naturally unwilling to assume for their new State a greater portion of the debt of Indonesia than is warranted.

The Netherlands wish to be generous in this—as in other respects; the settlement they have in mind is as follows:

A. Debts incurred before 1942 to be recognized in full.

Interior debts since 1942: the same; a devaluation is unavoidable, in consequence whereof these debts should not be too heavy a burden.

Exterior debts since 1942 to be negotiated with the Netherlands for a broad settlement with due regard to the economical possibilities of both states. As Indonesia is in the near future going to be a borrowing country this settlement will give reasonable prospects of repayment of new loans.

B. Permanent consultation with the Netherlands in the management of the national bank and currency control, and an appropriate voice therein so long as Indonesia remains heavily indebted to the Netherlands.

3. New Guinea.

Although New Guinea is a backward area which ethnographically and biologically does not form part of Indonesia and formed part of the Netherlands Indies merely in the interest of administration, the Indonesians claim its western half (the eastern half is under a trusteeship by Australia). By any standard, it is incapable of governing itself. There would be more justification for Indonesia to claim North Borneo or Malaya than any part of New Guinea.

It is the set purpose of the Netherlands Government that New Guinea remain under Dutch control so as to offer the best guarantees for expert improvement and development of this area in conformity with the principles of Chapter XI of the Charter of the United Nations.

4. Military.

The line of defense in the Far East against communism needs some bases: Hongkong, Philippines, Singapore and Surabaja.

The naval base in Surabaja can only be run by the Dutch Navy. For the foreseeable future the Indonesians have no navy.

An arrangement on these lines should be acceptable to the Indonesian delegation. It is doubtful whether this arrangement offers adequate guarantees to prevent chaos, but less than this would lead in a few months to Burmese conditions.

[Washington,] September 16, 1949.

1. Handed to Mr. Acheson by Foreign Minister Stikker on September 16.