Foreign Relations of the United States, 1955–1957, Southeast Asia, Volume XXII

171. Telegram From the Department of State to the Embassy in the Netherlands¹

Washington, August 14, 1956—6:23 p.m.

294. Dutch asked Dept August 13² make immediate approach Indonesian Government express US disapproval Indonesia’s announced repudiation all debts to Dutch assumed at 1949 Round Table Conference. Dutch stated they regarded Indo action as flagrant violation recognized international obligation taken in manner calculated destroy confidence between nations which essential basis international credit system. Dutch set remaining Indo indebtedness to them from loans assumed by Indo Government RTC at roughly 650 million guilders (171 million dollars) figure which corresponds statistics held by Department and IMF.

Dutch also asked Department take such additional measures it believes would be useful deterring Indonesia from further illegal actions. Statement at upcoming IMF Directors Meeting condemning Indonesian debt repudiation cited as example possible such additional measures. Department also asked inform Dutch of actions taken pursuant their requests.

Dutch understood making similar requests simultaneously to all NATO powers plus number Latin and Asian states.

Dept considering Dutch request.

Dulles

1. Source: Department of State, Central Files, 856D.10/8–1456. Confidential; Priority. Repeated to Djakarta. Drafted in WE, cleared with SPA, and approved in EUR.
2. A note dated August 13, presented by the Netherlands Chargé to Acting Assistant Secretary of State Elbrick, is attached to a memorandum of conversation by Bruce M. Lancaster of WE. (Ibid., 856D.10/8–1356)