CABLEGRAM FROM SPENDER TO CASEY

Washington, 6 July 1951

1. CONFIDENTIAL

Your 729.¹

Colombo Plan

1. Members of my staff have, at my direction, discussed proposed meeting of Consultative Committee with State Department Officials concerned including Malenbaum and Turnage, Chief, and Associate Chief, respectively of Investment and Economic Development staff; Merril Gay, Economic Adviser to Assistant Secretary for Far Eastern Affairs; Robert Fluker of Office of South Asian Affairs and Representative of Office of British Commonwealth Affairs.

2. Following views therefore represent State Department thinking although a firm departmental position has not yet been reached:

(a) State Department is prepared to participate in meeting of Officials but would not take initiative in pressing for it. They asked whether you suggested meeting before General Assembly because Australia thought question of Colombo Plan might be raised there. We suggested that reasons were probably shortage of our staff and desire to make progress with the plan. Whilst they would not wish to appear to influence decision on timing they would much prefer meeting to be held towards end of the year and certainly later than September because:

(i) Congressional action on foreign aid proposals might not be completed until September or October or even later, and State Department would like to know what funds would be available for the area when meeting held. United States aid will of course be extended on a bilateral basis.

(ii) State Department would like to be in a position to give some ‘impetus’ to the plan and play an active part in the discussions. Unless congressional action completed United States Representatives would be in same embarrassing position as was Kennedy at February 1951 meeting when United States had nothing to offer and could not therefore attempt to influence decisions.

(iii) Countries of the area might not have time to revise their estimates of needs (your paragraph 5 (c)(i) of meeting held in September).

(b) We were informed that objectives of meeting outlined in your paragraph 5 (c) correspond generally with their thinking. Following points were, however, raised;

(i) There appeared to be some ambiguity in paragraph 5 (c) (i) and hope was expressed that it was intended to cover re-examination of estimates of needs, etc, of Ceylon, India and Pakistan as well as consideration of certain of non-participating Governments of the area. Turnage referred in this connection to conversation reproduced in paragraph 4 of our 530.²

(ii) United States could not usefully discuss co-ordination until congressional action completed.

(iii) Question of Ministerial conference might be discussed at the meeting of officials.

(iv) Malenbaum said the discussion of conditions under which aid extended might usefully be taken up at meeting see memo No. 1175/51³ and paragraph 13 of our 930.⁴

(c) Meeting of officials should preferably be held somewhere in the area but State Department did not want to influence decision and had no firm preferences.

(d) Malenbaum expressed personal and informal view that United States might be able to go along with establishment of Secretariat even though little prospect of obtaining funds from Congress for the purpose. This might be arranged by seconding Foreign Service Officers already in the area who might be paid from regular State Department appropriation.

(e) Arguments regarding political importance of Consultative Committee as forum for discussion appreciated by State Department Officials who recalled Tange’s conversations with them on this point last year. They pointed out, however that meeting of Consultative Committee would not be of political value to United States if United States funds for expenditure in the area had not been appropriated when the meeting held. In such a case, false hopes might be raised as in the February 1951 meeting.

1. Discussion was most encouraging as State Department thinking indicated greater desire and intention than in previous discussions to collaborate and participate in the Consultative Committee and to work for the success of the Plan. For the first time, State Department Officials have clearly indicated that they wish to be both an active party in the Consultative Committee and so contribute to its discussions.

2. Following is extract from State Department press release of 3rd July (copy being sent by airmail) along same encouraging lines:

‘The Government of the United States looks forward to further co-operation with the countries of South and South East Asia in their efforts to raise productivity and standards of living. The Government of the United States intends to effect the greatest possible co-ordination between the development programmes it- had undertaken or may undertake in that area and any operative programmes under United Nations or Commonwealth Auspices. We extend our wishes for success to the countries participating in the plan and, with realisation of the spirit which has brought the plan to its official beginning, are confident of its ultimate success’.

[NAA: A1838, 160/11/1/1]