Foreign Relations of the United States: Diplomatic Papers, 1945, The British Commonwealth, The Far East, Volume VI

741.92/9–845

The British Embassy to the Department of State

Aide-Mémoire

1. His Majesty’s Government have given the most careful consideration to the State Department’s Aide-Mémoire of 1st September. Before replying in detail to the various points raised in it they desire to make certain general observations.

2. His Majesty’s Government are most anxious to attain the maximum degree of unity of action with the Government of the United States in the Far East as elsewhere.

3. Moreover it is their desire to see the restoration of a free, sovereign and independent Siam, and a renewal of the old friendly relations between Great Britain and Siam.

4. But if these objectives are to be reached the facts of the situation must be frankly faced. The State Department’s Memorandum records that Siam is the only country within the theatre of a combined Anglo-American Command with which one of the Governments represented in that Command is at war while the other is not. This is however solely due to the fact that the United States Government have chosen to ignore a declaration of war made by Siam upon them. His Majesty’s Government do not for one moment seek to question this decision on the part of the United States Government but they could hardly admit that it entitled the United States Government to ask that other Governments who are in a state of war with Siam should forego their rights or that it could justifiably be adduced as a reason for the mitigation of the conditions upon which those countries are prepared to liquidate the state of war. On the contrary, His Majesty’s Government would hope that the United States Government on their side will take no action to embarrass them or to compromise their position as an ally at war with Siam. In particular it would be difficult for His Majesty’s Government to agree that the action of the Supreme Allied Commander South East Asia should be limited solely to matters of concern to the Governments of the United Kingdom and the United States in relation to the war against Japan.

5. The attitude of His Majesty’s Government towards Siam has already been publicly declared in Mr. Bevin’s statement in the House of Commons of the 20th August.⁴⁷ In that statement the help received from the Siamese Resistance Movement was acknowledged and it was made clear that if the Movement had not taken overt action earlier this was due to advice given by the Allies on purely military grounds. But the fact must not be overlooked that the advice was given in the interests of the Siamese themselves and to prevent premature action which might have had unfortunate consequences for them.

6. His Majesty’s Government will now give all due weight to the assistance afforded by the Siamese Resistance Movement. But the state of war between Great Britain and Siam remains to be liquidated and Siam’s association with Japan leaves many practical questions for settlement. Mr. Bevin’s statement of the 20th August made it clear that the attitude of His Majesty’s Government will depend on the way in which the Siamese meet the requirements of the British troops now about to enter their country; the extent to which they undo the wrongs done by their predecessors and make restitution for injury, loss and damage caused to British and Allied interests; and the extent of their contribution to the restoration of peace, good order and economic rehabilitation in South East Asia. If these questions are approached on the Siamese side in the spirit of the proclamation issued by the Regent of Siam on the 16th August,⁴⁸ there is good reason to hope that a satisfactory solution may rapidly be reached.

7. The draft Heads of Agreement communicated to the State Department on the 20th August gave an indication of the conditions upon which His Majesty’s Government are prepared to liquidate the state of war with Siam and to recognise and collaborate with a friendly Siamese Government. In the State Department’s Aide-Mémoire it is suggested that in certain respects these terms may constitute an infringement of the sovereignty and independence of Siam. This is only true in the sense that any provisions which an enemy country is required to accept as a condition of the liquidation of a state of war are an infringement of its sovereignty and independence. His Majesty’s Government do not believe that their conditions are in any way unjust and it is for Siam, by the fulfilment of these conditions, to resume her place in the comity of nations on a basis of full equality with other sovereign and independent States.

8. His Majesty’s Government have drawn up their conditions in no spirit of retaliation for the injury done to Allied interests by Siam’s association with Japan. But they could scarcely accept a position in which Siam should profit from that association or, in such matters as the export of her commodities during the liberation period, from the needs of countries which have suffered from Japanese aggression.

9. His Majesty’s Government have also felt it incumbent upon them in their draft Conditions to safeguard the interests of other Allied powers until those powers are in a position to arrive at their own settlement with Siam.

10. In the light of these general considerations His Majesty’s Government have examined the various points of detail raised in the State Department’s Aide-Mémoire with every desire to go. as far as possible to meet the views of the United States Government.

11. If they take the question of rice first it is because on one major issue, namely that of the free contribution of 1,500,000 tons of rice, His Majesty’s Government regret that they find it impossible to bring their views into conformity with those expressed in the State Department’s Aide-Mémoire.

12. In the first place, His Majesty’s Government do not agree that Siam will face any serious external financial and economic problem. On the contrary Siam’s external resources (gold and foreign exchange) will have been conserved or even increased during the war period, while her external liabilities will not be increased substantially. There is, to the best of His Majesty’s Government’s knowledge, comparatively little war damage in Siam to be repaired before Siam can again enjoy a very favourable current trade position with the rest of the world.

13. Secondly, Siam alone among the nations involved in the war has been able in war conditions to accumulate a very large surplus of a commodity essential to the life of neighbouring territories, for the lack of which those territories have suffered hardship and even famine. The consequent rise in the price of rice to approximately three times the pre-war level has aggravated inflationary conditions in neighbouring and other countries.

14. If Siam were to be allowed to unload these involuntarily hoarded stocks at the present scarcity prices, the proceeds would bring Siam’s existing holdings of gold and foreign exchange to three times their present level. Even at half that price they would be doubled. In either event Siam would end the war in an incomparably better financial position than any of the other countries which were in a position to offer more serious resistance to the aggressor.

15. His Majesty’s Government feel very strongly on this point. They would regard it as contrary to all principles of justice that a country in Siam’s position should thus increase her claims upon the production of the rest of the world at a time when so many other nations must continue, for many years, efforts comparable to those which they made during the war in order merely to restore their pre-war standards of living.

16. The view of His Majesty’s Government is that Siam should contribute out of her abundance to the needs of other countries. They feel bound therefore to maintain Clause 23 (A) of the Annex to the draft Heads of Agreement as a condition to be accepted by Siam, unless in the meantime Siam makes an offer of a voluntary contribution of the same amount. From a Siamese source to which they have good reason to attach authority, His Majesty’s Government understand that this question is in fact under consideration by the Siamese authorities and that there exists at present in Siam a stockpile of 1,500,000 tons of rice. Should a free contribution be offered by the Siamese Government, His Majesty’s Government trust that the United States Government would waive their reluctance to share in the benefit of it.

17. While His Majesty’s Government do not, for the above reasons, feel able to forego the free contribution of 1,500,000 tons of rice, they would be very ready in principle to deal with the question of the future production and export of rice along the lines indicated in the State Department’s Aide-Mémoire, on the understanding that, once the proposed Agreement with the Siamese Government has been concluded, the operations of the proposed Rice Commission should be under British direction and that the principle of combined, as opposed to competitive, activity in the stimulation of the production and export of rice from Siam is accepted from the outset; and furthermore that the prices to be paid should be fixed in agreement with the Rice Commission having regard to the controlled prices of rice in other Asiatic producing areas and that no duties on the export of rice should be imposed greater than those in force before the 7th December 1941.

18. To give time for the further discussion of the United States proposals His Majesty’s Government have decided to omit from the Heads of Agreement to be communicated to the Siamese representatives Clause 23 (C) of the Annex as well as the Appendix referred to in that Clause and to amend Clause 23 (B) to read as follows:—

“Thereafter, for so long as in the opinion of the Combined Boards or other authority acting on behalf of the Allies a world shortage of rice continues, to take all possible measures to promote and to maintain the maximum rice production and to make available to an organisation to be set up for the purpose the resulting surpluses in a manner to be indicated by that organisation, and at prices fixed in agreement with it, having regard to the controlled prices of rice in other Asiatic producing areas.”

19. On the other hand, the necessity for acquiring rice from Siam without delay, if famine in liberated territories in Asia and possibly also in India is to be averted, is so great that it is essential forthwith to make temporary arrangements for the collection, bagging, transport to shipping port and shipment of the largest possible quantity of Siamese rice until such time as the proposed Rice Commission is ready to function. Measures are therefore in progress for the despatch at the earliest possible moment of competent personnel for this purpose who could be subsequently absorbed into the proposed Rice Commission.

20. The following observations relate to the other points raised in the State Department’s Aide-Mémoire.

21. The title “Siamese Liberation Government” was originally employed because it was anticipated that the Agreement would be negotiated with Siamese authorities which had broken away from the Siamese Government then associating with the Japanese. The final Agreement to be concluded on the basis of the draft Heads of Agreement will of course be with the Siamese Government. The word “Liberation” will accordingly be struck out where it now occurs in the draft Heads of Agreement.

Tin and Rubber

22. His Majesty’s Government have already explained the intention underlying Clause 5 of Section D of the Heads of Agreement.⁴⁹ In the light of the observations in the State Department’s Aide-Mémoire they have now decided to reword Clause 5 as follows:—

“Undertake to participate in any general international arrangement regarding tin and rubber which conforms with such principles regarding commodity arrangements as may be agreed by the United Nations organisation or its Economic and Social Council.”

Treatment of British Commercial Industrial and Professional Interests

23. His Majesty’s Government cannot well join in representations to a Government with which they are not in diplomatic relations and they regret that they do not see their way to leaving this important matter for settlement after the state of war has been liquidated. They are however happy to assure the United States Government that, although Clause 3 in Section D of the Heads of Agreement naturally refers to British interests only, it is not their intention to seek any exclusive privileges for those interests. His Majesty’s Government have accordingly decided to add to Clause 3 the following phrase:—

“Nothing in this Clause shall be deemed to preclude the grant of equally favourable treatment to nationals of any or all of the United Nations.”

Compensation for Loss, Damage etc. to Allied Nationals, Property, Rights and Interests

24. His Majesty’s Government regret that they cannot share the United States view that claims under this heading should be postponed until general reparations questions relating to Japan⁵⁰ are decided. Nor can they agree that the issue of currency for Japanese needs in Siam during the war affects Siam’s capacity to make due compensation to the Allies for loss or damage. While the internal value of the baht has been lowered, Siam’s reserves of sterling and gold have been conserved and for the purpose of external payments she is in no worse position than at the beginning of the war. His Majesty’s Government would of course have no objection to any consequential claim by Siam against Japan being considered when the general question of Japanese reparations is considered, provided that there is any surplus out of which such claim could be met after the claims of the United Nations have been satisfied.

25. His Majesty’s Government have, in response to the representations contained in the State Department’s Aide-Mémoire, decided to delete Clause 26 of the Annex to the draft Heads of Agreement relating to the payment for relief supplies in gold.

26. It is desirable in the general interest that the present anomalous situation in regard to Siam should be brought to an end at the earliest possible moment. It is thus a matter of great urgency to conclude an Agreement for the liquidation of the state of war between His Majesty’s Government and certain other powers on the one hand and Siam on the other. His Majesty’s Government are therefore now instructing Mr. Dening to make the necessary arrangements for a Siamese Mission to visit Kandy for the negotiation of an Agreement on the basis of the draft Heads of Agreement (with Annex) amended to take account as far as possible of the views of the United States Government.

Washington , September 8, 1945.

47. Parliamentary Debates, House of Commons, 5th series, vol. 413, col. 299.
48. For text, see letter of August 17, from the Thai Minister, to the Secretary of State, Department of State Bulletin, August 19, 1945, p. 261.
49. See note of September 6 from the British Minister, p. 1307.
50. For documentation on this subject, see pp. 989 ff.