Jakarta, 19 September 1963
840. Secret
Malaysia – Indonesian Policy
Despite the dramatic events of the last few days, notably the attack on the British and Malayan Embassies, and the withdrawal of the Malayan Embassy,1 the Indonesian Government’s ultimate objective remains unclear. Indeed it seems to me that the Government itself does not know what it is trying to do. By its actions, Indonesia has already done much to cause a serious deterioration in its relations with Western countries, including the United States. Certainly, if there are further attacks on Diplomatic Missions and if the Government does not put an immediate stop to union takeovers of British property, the situation could get out of control. Chairul Saleh’s and Subandrio’s remarks (my telegram 838)2 on this score are encouraging as is today’s announcement by Iskander3 that the union boycott of Malayan Airways and B.O.A.C. has been lifted. Moreover, Antara has reported that Subandrio personally intervened to mitigate a further demonstration at the residence of the British Ambassador.
2. Nevertheless the situation remains uncertain because of substantial doubts about Sukarno’s rationality on Malaysia and the activities of the P.K.I.
3. As regards Sukarno, the Minister’s talk with him showed that he is not much influenced by Indonesia’s likely difficult situation in the event that its anti-Malaysia policy is maintained openly. None of the arguments, such as the possible withdrawal of Western aid, which normally enter into the calculation of national interest, seem to be having much affect on Sukarno. Sukarno is easily the dominant figure of the regime and is, I think, under considerable pressure from the P.K.I. Those of his advisors who may feel that the present trend of policy could be disastrous for Indonesia have little room for manoeuvre. Thus, it is hard to believe that Subandrio would willingly embark on what has all the signs of a campaign to ‘confront’ the U.N. It is clear enough now that Sukarno had never been told that it was possible let alone probable that the U.N. would agree that Malaysia was acceptable to the people of Sarawak and Sabah. In the end he may come to his senses but to do so he will not be encouraged by reports widely publicised here, that following a mass demonstration in Kuala Lumpur, the Tunku stamped on the Indonesian Embassy Coat of Arms.4 Sukarno has in the past shown prudence and caution but recently he has acquired to a noticeable degree the megalomania and detachment from reality characteristic of many dictators.
4. The P.K.I. may be expected to encourage him in intransigence. Today’s Harian Rakjat5 is playing up to Garuda stamping incident as are the other newspapers. Of equal importance is the possibility that the P.K.I. through Sobsi6 will force the Government’s hands by taking over British enterprises. The P.K.I. has been actively campaigning for this, and non-Communist unions (with the exception of Sobsi) have made similar demands. The P.K.I. may reckon that the Government which has deliberately created mass anti-British feeling would find it difficult to take action against a determined and widespread bid by Sobsi to take over British property. Similar considerations apply to further anti-Western demonstrations. The Government may want to turn them off but may not be able to do so.
5. Account should also be taken of the fact that the Government is having difficulty in keeping down the price of rice (our savingram 56)7 which incidentally has gone up by 50% in Djakarta since Saturday. If the price remains up popular dissatisfaction with the regime is likely to grow. There may, therefore, be a temptation to go on following an extreme anti-Malaysia, anti-British policy to divert popular attention. While the Government would hope to keep this under control it is riding a tiger which it may find hard to jump off. The use of mob violence as our8 instrument of policy could possibly result in the long run in its being turned against the originators.
6. My following telegrams Nos. 841 and 8429 contain material relevant to assessment in this telegram.
[NAA: A1209, 1963/6637 part 3]
1 See editorial note, Malaysia Day Aftermath.
2 18 September. In it Shann reported that Subandrio had told the US Ambassador that British businesses were to be handed back to the British immediately, and that Saleh had confirmed this information.
3 Rear Air Marshal Iskandar, Minister of Air Transportation.
4 See editorial note, Malaysia Day Aftermath.
5 People’s Daily —the PKI’s daily newspaper.
6 Sentral Organisasi Buruh Seluruh Indonesia �Central Bureau of the All-Indonesian Labor Union—the PKI’s national labor federation.
7 Not published.
8 Presumably, this should read ‘their’ or ‘an’.
9 Cablegram 841, dated 18 September, contained Indonesian newspaper reports deploring the findings of the UN Mission in Sarawak and Sabah. Cablegram 842, of 19 September, reported on Harian Rakjat’s coverage of an anti-Malaysia rally organised by communist controlled youth organisations on 16 September, and of the unions’ takeover of a number of British businesses.