Note by Department of External Affairs

Canberra, 8 December 1949

Australian Aid to South East Asia

I. Relief funds

(a) Allocation

Out of the grant of 4 million pounds approved by Cabinet for Australian post-UNKRA relief in May 1947, £480,000 was set aside for the purchase of relief supplies to South East Asian countries. Freight on these supplies is paid by the Australian Government.

It was first intended that the allocation should be divided as follows:

Mr. Macmahon Ball1, who was sent on a-goodwill mission through South East Asian countries in May 1948, discussed the provision of relief supplies with the governments concerned. After his tour these governments considered the lists of available supplies submitted to them and notified the Australian authorities of those goods which they wished to receive. In the final result the funds were allocated as follows:

(b) Shipment

The majority of the supplies had left Australia by the end of 1948, with the notable exception of £88,912 worth of stores for the Netherlands authorities and £93,556 worth for the Republic of Indonesia. Owing to the ban on shipping to the Indies, these goods have remained in store in Melbourne. Now that the ban has been removed, arrangements are being made for their shipment as soon as possible to Batavia.

(c) Goods supplied

All the goods sent as relief supplies to South East Asian countries have come from holdings of services disposals stores. They have consisted of textiles (made-up clothing), X-ray equipment, and medical supplies, including drugs and instruments.

II. Educational materials

On 12th January, 1948, the sum of £30,000 was set aside for the supply of educational materials through U.N.E.S.C.O. to South East Asian countries. An additional sum of £16,000 was allocated in June, 1949, making £46,000 in all.

III. Fellowships

The sum of £60,000 was allocated on 12th January, 1948, for the provision of senior and junior post-graduate fellowships for South East Asian countries. The senior fellowships, each of £600 p.a., are from six months to one year’s duration, and are intended for refresher courses in particular fields of study. The junior fellowships, of £400 p.a., are from six months to two years, and are intended for general study at the post-graduate level. Fellows from the following countries will study under the programme in 1950:

IV. Scholarships

On the same date, the sum of £5,000 per annum was approved for the provision of three annual scholarships at the Technical school or University level for students from South East Asian countries. The number of scholarships was increased to four in September, 1949.

Two of these scholarships are for four years, one for three years, and one, to be held by a Malayan nurse, for two years.

The scholarships for 1950 will be held by students from Malaya, India, the Philippines and the British dependencies in South East Asia.

V. Australian relief and other assistance to South East Asian countries may be summarised as follows:

AUSTRALIAN AID TO SOUTH EAST ASIA AVAILABILITY OF FUTURE SUPPLIES

I. Kinds of goods supplied

The supplies sent to South East Asia under the Australian relief programme so far have been goods fairly readily available in Australia, in that, apart from the small supplies of U.N.I.C.E.F. foodstuffs, they have been drawn from stocks of surplus equipment left over from the war. The supply position may be more difficult in future, both because of the exhaustion of suitable stock of disposals goods and because South East Asian countries may require different kinds of supplies from those which they have hitherto received.

The Department of Supply and Development has stated that no further stocks of the kinds of goods already sent are available at present. It added, however, that stocks are still being declared by the Service departments, so that further supplies maybe expected to accumulate. It is likely that there would still be a demand in South East Asian countries for many of these goods; in particular, for medical supplies and clothing, though much of the clothing available may be too heavy. On the other hand, it is relevant that not all of the countries offered supplies under the original scheme requested goods to the full value of their quotas. Burma, for example, asked for only £77,000 and Malaya for £152,000 worth of the £160,000 worth of goods offered to each; though a total of £250,000 was taken up by Indonesia, for which the same sum had originally been provided.

Finally, it should be noted that we have no information at present on the types of disposals stocks which may be available in future; but it must be expected that they will decrease in variety and in suitability for relief purposes.

II. Future supplies

A) Relief. The disposal stocks which have hitherto been used for relief are in the nature of a windfall. In ftiture it will be necessary to draw increasingly on goods intended for the internal market, the diversion of which will need to be considered in the context of Australian demands. For relief purposes, the goods likely to be needed are medical supplies; (drugs, insecticides, X-ray and hospital equipment); clothing and footwear suitable for tropical conditions and foodstuffs (tinned milk, proteins, wheat, margarine, etc.). Australia is probably in a fairly good position to supply the majority of these, though it may be difficult to obtain more complicated items such as hospital equipment. All supplies of copra are bought by the U.K. Government, so that the provision of margarine would be a matter for negotiation. Meat is subject to similar agreement. Tinned milk is available on the open market, but is scarce.

B) General economic aid. Prima facie, it appears that most of the kinds of goods likely to be most in demand by South East Asian countries under a general programme of economic aid would also be in strong demand in Australia. The main need of the area is likely to be for capital equipment including the following:

(a) transport equipment (locomotives, cars, road making machinery, steel rails);

(b) constructional materials (steel, timber);

(c) agricultural equipment (light and heavy, from tractors to hoes);

(d) communications equipment (telephones, wires, etc.)

Other goods are,

(e) chemicals;

(f) foodstuffs (meat, wheat, dairy produce);

(g) textiles.

The supply of (a), (b) and (d) would be difficult, in view of the shortages of these goods in Australia. It is doubtful, in fact, whether any constructional material could be made available for a period of some years.

In respect of (c) the kind of equipment required would be an important point. Australia would not be in a good position to supply heavy agricultural machinery—it is at present a large importer of tractors, for example. It should be possible to provide light agricultural machinery, such as hand ploughs, and horticultural implements, though it appears that in general implements supplied would have to be of the kind used in South East Asia, which differ from those normally manufactured in Australia.

In respect of (e), the kinds of chemicals required would need further investigation. A considerable proportion would be those used in the tin and rubber industries, and also perhaps artificial fertilisers. It is worth noting that Australian exports of chemicals to South East Asian countries have increased considerably since the war. There seems no reason to expect supply to be affected by local shortages.

No comment is made in respect of (f), beyond the statement that it should be possible for Australia to supply basic foodstuffs, even though their provision would have to be considered in the context of other commitments.

In respect of (g) there would be no difficulty in the supply of woollen goods, but it is doubtful whether there would be much demand for them in South East Asian countries, which presumably use cotton textiles for the most part.

[NAA: A1838, 532/7 part 1]

1 W. Macmahon Ball, Professor, Department of Political Science, University of Melbourne; leader of goodwill mission to South-East Asia, 1948.