Cablegram 3649 (extract) CANBERRA, 10 July 1941
MOST IMMEDIATE SECRET
For the Secretary of State for Dominion Affairs. [1]
Prior to the outbreak of hostilities between Germany and Russia,
we had been reviewing the position that had been reached in regard
to economic policy towards Japan. We were about to suggest to you
that the various economic measures in operation and in
contemplation be considered in relation to foreign policy, and
that the possible effects on our political relationships with
Japan, and our preparedness for any aggressive move by Japan, be
summed up. [2]
At the time we had before us your proposal that we should reduce
our lead exports to Japan to 2,500 tons annually [3], and we were
also considering the Japanese requests for copra and wheat, and
your views in regard to them. [4] Our general attitude was that we
were prepared to cooperate in regard to these matters, provided
the action proposed was valuable in securing United States co-
operation, and was part of a carefully weighed plan with adequate
safeguards for us. We were, however, apprehensive regarding the
effect of the proposed action on our relations with Japan,
particularly in regard to copra, large quantities of which are
lying on many undefended beaches in the Pacific.
When Germany attacked Russia, we suspended action while awaiting
developments. Since then we have studied with interest your
several telegrams on the subject [5], and have noted your
instructions to His Majesty’s Ambassador at Tokyo. [6] You mention
in your telegram of 4th July, Circular D.396, that the Japanese
Embassy have pressed the request for copra from New Guinea, and
have referred to the effect of the closing of the Siberian railway
on the possibility of re-export. The Japanese Minister in
Australia has made a similar request to us. [7]
The Australian Minister at Tokyo has expressed to us views similar
to those forwarded to you by His Majesty’s Ambassador. Sir John
Latham recently advised us that, while there is a strong case on
economic grounds for the restrictions on further food supplies, a
political assessment of the position must have regard to the fact
that the Japanese people are short of rice, wheat and food oil.
Our Minister points out that it would be possible to work up
indignation against the Empire for denying supplies in view of the
fact that Netherlands East Indies and United States are allowing
supplies of oil and wheat to go to Japan. [8] (We know of course
that the exports of copra from Netherlands East Indies are very
small, but we are not clear regarding current exports from
Philippine Islands.)
While our Minister advises us to permit small supplies of
foodstuffs to go forward, we are trying to postpone a decision as
long as possible. In the meantime we would very much appreciate
advice whether, in deciding on measures against Japan in the
sphere of economic warfare, you feel that we must take a chance as
to Japan’s reactions, which may be bitter and may appear well
founded, and whether you consider that effective means of
countering any aggressive action by Japan are available, including
United States collaboration. In this regard we have noted the
relevant portion of your telegram of 6th July, Circular D.399. [9]
[matter omitted]
MENZIES
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1 Lord Cranborne.
2 For previous interdepartmental discussion along these lines see
file AA : A981, Far East 20B, i.
3 See Cranborne’s cablegram 391 of 2 June on the file cited in
note 2.
4 See Documents on Australian Foreign Policy 1937-49, vol. IV,
Documents 482 and 502; and file AA : A981, Japan 152 for telegrams
from Tatsuo Kawai (Japanese Minister to Australia) to Sir Earle
Page (Minister for Commerce) on 8 May and to A. W. Fadden (Acting
Prime Minister) on 12 and 17 May.
5 See circular cablegrams D378 and D379 of 27 June and D396 and
D397 of 4 July on the file cited in note 2.
6 In circular cablegram D396 the U.K. Govt bad advised the
Commonwealth Govt of its intimation to Sir Robert Craigie in Tokyo
that there would be no relaxation of economic restrictions while
Japan remained an Axis member. Lord Cranborne reaffirmed this
policy in his reply to cablegram 3649. See cablegram 478 of 12
July on file AA : A1608, G59/1/3, ii.
7 Kawai’s letter of 27 June to Menzies is on the file cited in
note 4.
8 For Latham’s views see Documents on Australian Foreign Policy
1937 49, vol. IV, Document 518.
9 The fifth paragraph of cablegram D399 (on file AA : A981, Far
East 21) referred to an assurance given recently by Sumner Welles
(U.S. Acting Secretary of State) that if Japan embarked on
hostilities either to the north or south the U.S. Govt would
immediately apply all pressure at its command.
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[AA : A981, FAR EAST 20B, i]
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