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

851G.00/9–2849

Memorandum by Mr. James L. O’Sullivan, of the Division of Southeast Asian Affairs, on Preliminary Talks as to Indochina¹

top secret

[Washington, September 28, 1949.]

Preliminary Talks [on] Indochina

Mr. Dening and Mr. Butterworth
(September 8 through September 12)

[Here follows summary of conversation on September 9; see memorandum of that date, page 76.]

In connection with the conversations on recognition of a Chinese Communist government,² Mr. Butterworth stated that the Department had recently circulated its missions in SEA on the question of probable reaction in that area to recognition of a Chinese Communist government by the Western powers, and that the replies so far received indicated without exception that early recognition by the Western powers would cause adverse reactions in Southeast Asia. Mr. Dening commented that, whether early or late, recognition would have adverse consequences. Mr. Butterworth said that in the Department’s view early recognition would carry special disadvantages for Southeast Asia.

In connection with the discussions on Hong Kong, Mr. Dening stated that the Ministers of the Cabinet had authorized Mr. Bevin to tell the Secretary that the UK considered Hong Kong the right wing bastion of the Southeast Asian front; that if Hong Kong were lost, the whole front might go; that the UK regards Hong Kong in the same way that it regards Berlin; and that the UK will disregard the extent of military commitment necessary to hold Hong Kong but that it must not go.

In connection with the Japanese peace treaty, Mr. Meade (First Secretary of the British Embassy) recognizing the possibility of the emergence of Indonesia and/or Indochina as sovereign states, considered that all countries which had actually waged, not just declared, war on Japan should be asked to the conference. Mr. Butterworth pointed out that this formula would admit Mexico and possibly other countries having remote interests in the Far East, a situation which would be resented by the Asiatics.

In connection with a regional arrangement in Southeast Asia, Mr. Dening stated that the British government considered that the first and necessary step toward meeting the Communist threat to Southeast Asia was to develop the economies of the countries of the area to a degree of strength equal if not superior to Communist pressure. Mr. Butterworth pointed out that the essential political instabilities in Indonesia and Indochina were an almost insurmountable obstacle to the successful extension of financial and economic assistance. In answer to a question, Mr. Dening stated his belief that the influence of anti-Communist states would have an appreciable influence on India adding that India was learning more about Communism in Asia as time went on; that, for example, Ho Chi Minh’s radio association with Stalin had had a salutary effect upon the Indian estimates of the Communist character of Ho Chi Minh’s government.

Secretary–Mr. Bevin conversation³

The Secretary pointed out to Mr. Bevin that we feel nationalism is an offset to Communism and a rallying point for dissatisfied elements who otherwise might become Communists. In promoting nationalism, we, of course, must be careful not to encourage the native peoples to feel resentment towards colonial powers. We feel that the French and Dutch should follow the excellent British lead. We plan to talk to Mr. Schuman and urge that the French move faster in Indochina in setting up a Vietnam national state. We would like to see some of the Asiatic nations take the lead in recognizing a nationalist government there. We feel it would be the “kiss of death” if we or the British took the lead.

In reply, Mr. Bevin said he wished the French had gone further in Vietnam. He said it was possible the French wanted the United States and Great Britain to recognize the Bao Dai government in Indochina so that they could present a fait accompli to the Assembly and the Assembly would have to ratify the new agreements. But he didn’t like this possibility. He said that before we did anything, the French government should ratify the agreements and shift its dealings with the Bao Dai government from the Colonial office to the Foreign office. We can’t recognize the Bao Dai government until the French take these steps but we don’t want the favorable possibility to go by default either. Mr. Dening said the people of Indochina wanted peace more than anything else. The Secretary said that we can feel Mr. Schuman out but we must get the French to take the requisite steps. Can we get countries in the area, say Burma and India, to take the lead in recognition after the French do the necessary? Mr. Bevin said they hadn’t sounded them out and that the Burmese and Siamese were cautious. He thought that if the French ratify, we could get the Asiatics to recognize the de facto government. Ho Chi Minh had thanked Stalin in a radio broadcast for assistance and had exposed his hand as being a Moscow Communist and this had been passed on to Nehru who previously had thought Ho was a bona fide Nationalist leader. Mr. Bevin repeated that the French must give us the groundwork.

Mr. Butterworth emphasized that while we are not fully satisfied with the Bao Dai regime, we saw no acceptable alternative in this area, and that accordingly we and the British should push behind this experiment. He called attention to a recent report from our Consul General in Saigon to the effect that the fillip which had been given by our original statement and that of the British government on Bao Dai was now wearing off and there was need for a new effort. Before turning to other subjects, an understanding was reached between Mr. Bevin and the Secretary that we would meet with Mr. Schuman and urge him strongly to take the two steps referred to; namely, ratification and the transfer of business to the Foreign Office. Subsequently, Mr. Bevin would take the matter up with the Asiatic Commonwealth countries.

In a meeting (September 14) with Mr. Dening, the day following the Secretary’s conversation with Mr. Bevin, called for the purpose of tying up any loose ends that might have appeared, Mr. Butterworth suggested that it would be helpful if Mr. Bevin would impress upon Mr. Schuman the importance of France’s imposing as few restrictions as possible on the ability of the Vietnam government to conduct its foreign relations, arguing that this would be an important factor in obtaining the recognition of the Vietnam government by South Asian countries. Mr. Dening observed that Mr. Schuman would undoubtedly reply that the March 8 Agreement goes as far as it can in this direction without causing trouble with French North Africa; but that he was inclined to agree with Mr. Butterworth that the issue is of sufficient importance to bring to Mr. Schuman’s attention again in the context of the difficulties which would arise were the Bao Dai government not recognized by India, Burma and other nearby countries. In this connection, Mr. Dening stated that the UK had been at pains to convince Nehru that Bao Dai, rather than Ho Chi Minh, is the power in Indochina with whom India should deal.

Secretary–Mr. Schuman Conversation (September 15)

Mr. Schuman outlined France’s views on the Indochinese situation as follows:

France is faced with a very serious situation in Indochina because of the heavy financial strain it places on French budgetary equilibrium. French expenditures in Indochina would amount this year to almost 200 billion francs, approximately one-eighth of the total French budget.

He said that the French efforts to prevent Indochina from falling into Communist hands transcended and went far beyond French national interests since French action represented the hard core of resistance to Communist attempts to take over Indochina with a view ultimately to take over all of Southeast Asia. France was therefore fighting the battle of all the democratic powers and would need assistance to hold Indochina. He realized that it was politically impossible for the United States to give military aid to Indochina but there were forms of economic assistance which the United States could give. This assistance need not be given directly to France but be given to the three governments (the Vietnam state of Bao Dai which unites the three kys; Laos; and Cambodia) which France had established in Indochina. In this connection France had turned over a large measure of independence to these governments and was sponsoring a truly nationalist movement in Indochina so that these governments could win the support of the overwhelming majority of the inhabitants who were certainly not pro-Communist. He said that the Bao Dai agreements of March 8 did not represent a limit to the concessions which the French would eventually make and that France intended to follow an enlightened course looking to greater self-government. Mr. Schuman hoped that the United States also would support these independent governments.

In conclusion Schuman said he wished to point out that a number of people were perhaps laboring under the mistaken belief that if France got out of Indochina the native inhabitants would have a better chance of attaining real independence. This was an erroneous viewpoint since at the present time the three infant governments were incapable of succeeding alone and would need French military assistance to survive the Communist efforts to take over the country and would also need French technical assistance to arrive at a point where they could cope with their own internal problems of organization. In other words the presence of the French Army and French technical advisers was indispensable to the emergence of truly nationalist and independent states in Indochina. He reiterated that France intended to be most liberal in dealing with these governments so that gradually they could attain an increasing degree of independence. He said that in a sense France had been penalized for trying to hold the line against Communist efforts in Indochina since as a result thereof Indochina had been excluded from the benefits of the Marshall Plan.

The Secretary replied that he was very glad to have had Mr. Schuman outline the French position to him and he was particularly glad to note that in many respects the French thinking was so close to our own. The Secretary said that he could not give Mr. Schuman any reply as to the question of what aid might be given to Indochina as he would have to study the matter very carefully. He said, however, that we realized that the presence of French troops and technical advisers in Indochina was indispensable at this stage of the game and for a considerable time to come and that we had never suggested that the French withdraw and abandon Indochina. The Secretary said that we fully recognized the importance of Indochina in connection with the whole Southeast Asia picture but that he did believe the French could play a great role in preventing Communist domination by moving quickly wherever possible to satisfy the truly nationalist aspirations of the inhabitants.

In connection with the question of what might be done for the governments in Indochina, the Secretary said he hoped the French Parliament would ratify the March 8 Agreements rapidly but he wished to mention that at present the French position seemed somewhat anomalous in that Indochinese affairs are now being administered by the French Ministry of Overseas Areas which did not seem consistent with the French statement that the governments are to a large degree independent. The Secretary said that he also thought it was most important that the other governments of Southeast Asia, particularly India, Burma and Siam, recognize the independent status of the Bao Dai government and in this connection the French could be helpful by giving greater independence to the Indochinese governments in their foreign relations. The Secretary said that at the present time and given conditions in Indochina he realized it might be difficult to give the Indochinese governments as much internal authority as was desirable but that in the field of foreign affairs there certainly appeared something that could be done. He said that if the United States and Great Britain rushed in to recognize the Bao Dai Government it might, in a sense, be the “kiss of death” to Bao Dai since certain Asian political leaders such as Nehru, might think that the United States and Great Britain were acting with imperialistic motives to insure continuing full French control and domination of Indochina. On the other hand the Secretary thought that the British might be helpful in getting the governments of India and Burma to recognize the Bao Dai Government and we would be disposed to do what we could to encourage the Governments of Southeast Asia to recognize the Indo-Chinese nationalist government which had recently been established as a result of the March 8 Agreements.

Mr. Schuman said that he agreed with the Secretary and that he had already taken up with the French Cabinet the question of transferring responsibility for Indochina from the French Ministry of Overseas France to the French Foreign Office. While he hoped to be able to arrange for this it was difficult at the moment because of French internal considerations but that once the March 8 Agreements were ratified he thought it would be much easier and he hoped that this ratification would occur soon after the Parliament reconvened in October. Mr. Schuman said that he also agreed with the advisability of the other Southeast Asian governments recognizing Bao Dai.

Secretary–Mr. Bevin–Mr. Schuman Conversation (September 17)

Mr. Schuman then talked about Indochina. He said the Bao Dai government was not quite complete but it was satisfactory. The government was not yet fully established but it would be and it was the only way for a permanent solution. There is no love lost between the Chinese and the Indochinese. The Indochinese are afraid of China. Some of Ho’s men, if there was a threat of invasion from China, might go over to Bai Dai. If the Southeast Asian countries recognize the Bao Dai government, its prestige would be increased. Perhaps the United Kingdom and the United States could help the French with Southeast Asia. The agreement with the Bao Dai government would be ratified by the French Parliament soon. Siam perhaps could be encouraged to recognize, by a word from the United States or the United Kingdom, the Bao Dai government. Bevin asked when the French Parliament would ratify the agreement. Schuman replied that Parliament meets on October 18 and should ratify it a few weeks after that—perhaps in November. Bevin remarked that France has to ratify the agreement before anyone else can help.

The Secretary said that if the French ratify the March 8 Agreement and transfer dealings with Bao Dai to the Foreign Office, we could help with the Philippines and Siam. The Southeast Asian countries should take the first steps, otherwise recognition by the United Kingdom and the United States in advance of other countries would make the Bao Dai government look like a Western “front”. Congress may take up the question of Point Four Program⁴ after the Military Assistance Pact. Perhaps we can arrange technical assistance and Export-Import Bank funds.

1. Copy transmitted by the Department to 14 posts (Tokyo, Manila, Rangoon, Karachi, Bangkok, Colombo, Seoul, New Delhi, Saigon, Batavia, Singapore, Taipei, Hanoi, and Kuala Lumpur) by October 10.
2. For documentation on this subject, dated September 9, see vol. ix, pp. 76 ff.
3. On September 13.
4. For statement by Under Secretary of State Webb on August 9 before the Senate Banking and Currency Committee, see “Relation of Private Investment to Point 4 Program”, Department of State Bulletin, August 22, 1949, p. 274. Documentation on Point 4 Program is scheduled for publication in volume i.