Proposals of the Bandoeng Negara Conference  (telegram K144 ) are entirely unsatisfactory to the Republic as they are limited to arrangements for the interim period and do not sufficiently define powers even in respect of that period. The Republic at this stage can only consider overall proposals.
2. The Republic, which is concerned with the possibility of its own dissolution unless it takes the intiative, will now call off all negotiations other than those regarding the implementation of the truce. Roem will make a statement to the Steering Committee to-day that no progress has been made in political talks since the Netherlands refusal to consider Australian - United States proposals  and that until a new and mutually acceptable basis for negotiations can be found the Republic sees no purpose in continuing the talks.
3. I shall endeavour to have the Committee report the breakdown in negotiations and am sounding out the possibility of the Committee taking some initiative. The latter, however, is unlikely, particularly in view of the Belgian attitude. Herremans will be returning to Belgium for a short visit next week, leaving a deputy.
4. The Committee yesterday completed its report to the Security Council on trade restrictions. This is as strong as possible for a unanimous report and makes it clear that Republic's economic difficulties are largely attributable to Netherlands trade regulations.