547 Barnett to Burton

Cablegram 141 NOUMEA, 29 November 1947, 5 p.m.

TOP SECRET PERSONAL

Have been informed by Bonneaud, President of Conseil General, that several urgent and strongly worded telegrams addressed by him to the Minister for Overseas Territories stressing the immediate need of dollars and sterling credits to ensure continuance of vital supplies, have so far been ignored. Last telegram despatched November 27th stated that New Caledonia would have to seek financial aid elsewhere if France could not immediately fulfil recent undertaking by converting New Caledonia's accumulated Paris balances to dollars or sterling. If the need arises the President favours approach to Australia but it is likely that others with financial interests in America would favour approach to the United States. This argument would be strengthened by the fact that the United States is the only outlet for nickel and chrome if deterioration in Australia leads to severance of commercial relations. Dewez [1] (vide our telegram 58 of 1900 [2]) may be leader of pro-United States groups. His headquarters are New York but he visits New Caledonia frequently and is now at Noumea.

If the economic domination of New Caledonia by the United States is considered to be contrary to our best interests strongly urge that we anticipate request for financial aid and formulate a policy accordingly in order that reply could be furnished immediately should the request eventuate bearing in mind that the approach might be made by Conseil approval of Governor.

Bonneaud informs me that he has not yet confided to his colleagues in the Conseil General the above information re telegrams to the Minister because at this stage he does not want the gravity of the situation generally known. [3]

1 Henry Dewez, banker and international financier whose interests included nickel and phosphates.

2 A sign here indicates 'as received'.

3 Burton commented, in a memorandum to Treasury on 3 December, that assistance to New Caledonia would accord with Australia's general policy of fostering improved relations with neighbouring Pacific territories, and that although he saw no need for concern in a generous US credit policy, there was a market for Australian primary and secondary products in New Caledonia which might be worth cultivating.

[AA : A1838,324/1/2]