Foreign Relations of the United States, 1955–1957, China, Volume II

12. National Security Council Report¹

NSC 5503

Washington , January 15, 1955 .

U.S. POLICY TOWARD FORMOSA AND THE GOVERNMENT OF THE REPUBLIC OF CHINA

Note by the Executive Secretary to the National Security Council

[Here follows a note from Lay dated January 15, 1955, stating that the President had that day approved the statement of policy contained in NSC 5441, as amended and adopted by the National Security Council on January 13, and that the President directed its implementation by all appropriate executive departments and agencies and designated the Operations Coordinating Board as the coordinating agency. It also stated that NSC 146/2 and NSC Action No. 1146 were thereby superseded and took note of NSC Action No. 1301–c.]

STATEMENT OF POLICY BY THE NATIONAL SECURITY COUNCIL ON U.S. POLICY TOWARD FORMOSA AND THE GOVERNMENT OF THE REPUBLIC OF CHINA (GRC)

Objectives

1. Maintenance of the security of Formosa and the Pescadores as a part of the Pacific off-shore island chain, which is an element essential to U.S. security.

2. An increasingly efficient Government of the Republic of China (GRC), evolving toward responsible representative government, capable of attracting growing support and allegiance from the people of mainland China and Formosa, and serving as the focal point of the free Chinese alternative to Communism.

3. Continued development of the military potential of GRC armed forces (a) to assist in the defense of Formosa and the Pescadores and (b) to take action in defense of the GRC-held off-shore islands, equipped and trained to contribute to collective non-Communist strength in the Far East and for such other action as may be mutually agreed upon under the terms of the Mutual Defense Treaty.

4. Use of GRC military potential, including the availability of Formosa and the Pescadores for the use of U.S. forces under the terms of the Mutual Defense Treaty, in accordance with U.S. national security policies.

5. Development of a stronger Formosan economy.

6. Improved relations between the GRC and other non-Communist nations.

7. Continued recognition and political support of the GRC as the only government of China and as the representative of China in the United Nations and other international bodies.

8. Increased support for the GRC by non-Communist Chinese outside mainland China and Formosa, expecially the overseas Chinese of Southeast Asia, insofar as such support does not conflict with obligations to their local governments.

Courses of Action

9. Effectively implement the terms of the Mutual Defense Treaty, taking all necessary measures to defend Formosa and the Pescadores against armed attack.

10. Seek to preserve, through United Nations action, the status quo of the GRC-held off-shore islands, and, without committing U.S. forces except as militarily desirable in the event of Chinese Communist attack on Formosa and the Pescadores, provide to the GRC forces military equipment and training to assist them to defend such off-shore islands, using Formosa as a base.

11. Do not agree to GRC offensive actions against mainland Communist China, except under circumstances approved by the President. Agree to GRC actions against Communist China which are prompt and clear retaliation against a Chinese Communist attack; provided such retaliation is against targets of military significance which meet U.S. criteria as to feasibility and chance of success and which are selected with due consideration for the undesirability of provoking further Chinese Communist reaction against Formosa and the Pescadores.

12. Continue covert operations . . . .

13. Continue military assistance and direct forces support for the GRC armed forces to enable them to assist in the defense of Formosa and the Pescadores, to take action in defense of the GRC-held off-shore islands, and so equip and train them as to enable them to contribute to non-Communist strength in the Far East and for such other action as may be mutually agreed upon under the terms of the Mutual Defense Treaty.

14. Continue coordinated military planning with the GRC designed to achieve maximum cooperation from it in furtherance of over-all U.S. military strategy in the Far East.

15. Encourage and assist the GRC, through such means as off-shore procurement and technical advice, to construct and maintain on Formosa selected arsenals and other military support industries.

16. Exercise the right, as appropriate, under the terms of the Mutual Defense Treaty, to dispose such U.S. land, air and naval forces in and about Formosa and the Pescadores as may be required in U.S. interests.

17. Show continuing U.S. friendship for the GRC and the Chinese people, while avoiding any implication of an obligation to guarantee the former’s return to power on the mainland.

18. Encourage and assist the GRC to take steps leading toward more responsible representative government suited to the Chinese environment and having a constructive social and economic program, so as to deserve the support and allegiance of the people of Formosa and to serve as the focal point of the free Chinese alternative to Communism. So far as feasible, employ U.S. assistance as a lever to this end.

19. Continue to recognize the Government of the Republic of China as the only government of China and to support its right to represent China in the United Nations. Seek to persuade other non-Communist countries to do likewise.

20. To the extent feasible, encourage the GRC to establish closer contact with the Chinese communities outside mainland China and Formosa and to take steps to win their sympathy and support, insofar as such support does not conflict with obligations to their local governments. Encourage the leaders of these communities to reciprocate by extending sympathy and support to the GRC as the focal point of the free Chinese alternative to Communism and as a Free World partner in the defense against Communist expansion in Asia.

21. Maintain contact through U.S. officials with anti-Communist Chinese groups outside Formosa which continue to reject cooperation with the GRC, and, without making commitments of U.S. support, encourage such groups actively to oppose Communism.

22. Encourage conditions which will make possible the inclusion of the GRC in a Western Pacific collective defense arrangement comprising the United States, the Philippines, Japan, and the Republic of Korea, eventually to be linked with the Manila Pact² and ANZUS.³

23. Continue to provide such technical and economic assistance to Formosa as will promote U.S. objectives and will be consistent with other U.S. programs of economic and military aid for the Far East.

24. Encourage conditions which will make possible the eventual inclusion of the GRC in such economic grouping as may be organized among the free nations of Asia.

25. Take all feasible measures to increase the opportunities for the GRC to develop a well-balanced trade with the non-Communist nations of Asia and with other free world countries.

26. Continue to assist the GRC to plan the most productive use of Formosan resources in their own best interests, so as to complement the economies of other free countries, particularly Japan and the Philippines.

27. Continue to work with the GRC toward better fiscal procedures and the revision of programs which run counter to prudent U.S. advice.

28. Encourage the GRC to adopt policies which will stimulate the investment of Chinese and other private capital and skills for the development of the Formosan economy, under arrangements avoiding “exploitation” yet acceptable to private interests.

29. Consistent with the foregoing objectives and courses of action, continue programs in which Formosa serves as a base for psychological operations against the mainland.

30. Continue U.S.-sponsored information, cultural, education, and exchange programs; expand the program for training Chinese and Formosan leaders.

31. Seek to improve relations between the GRC and other non-Communist countries, and develop an appreciation on the part of these countries of the GRC and of the favorable conditions existing on Formosa, by such means as encouraging official and non-official visits to Formosa.

32. Attempt to convince other free world countries of the soundness of U.S. policy toward the Republic of China and of the advisability of their adopting similar policies.

[Here follows an annex entitled “Summary Statement of Current Military and Economic Assistance Programs for Formosa”. It is identical to the annex to NSC 5441; see Foreign Relations, 1952–1954, volume XIV, Part 1, page 1051.]

1. Source: Department of State, S/S–NSC Files: Lot 63 D 351, NSC 5503 Series. Top Secret.
2. The Southeast Asia Collective Defense Treaty, signed at Manila on September 8, 1954; 6 UST 81.
3. Australia, New Zealand, and the United States; for the text of the security treaty between the three countries, signed at San Francisco on September 1, 1951, see 3 UST 3420.