286 Chifley to Fraser

Cablegram unnumbered CANBERRA, [14 June 1949] [1]

TOP SECRET AND PERSONAL

1. The question of Hongkong was brought by me before Cabinet today and the suggested offer by New Zealand of three frigates for the defence of Hongkong was taken fully into consideration.

2. The general policy of the government in relation to Hongkong was set out in a personal message from myself to Mr. Attlee dated 30th May, 1949 [2] and contained in my immediately following telegram.

3. The Australian Cabinet has decided not to offer to send either naval, air or land forces for the defence of Hongkong.

4. There are many practical difficulties associated with such action one of which is Australia's present obligation to continue to maintain certain air, naval and land personnel for the occupation of Japan.

5. There is a danger of over simplification if the question is regarded as making Hongkong the point to hold back Communist aggression in the Far East. It seems certain that the United States would take no active part in such resistance.

6. Nor can the Australian Cabinet overlook the fact that in 1945 Chiang Kai-shek had 'the ball at his feet' thanks largely to the Pacific war effort of the United States, Australia, New Zealand and Britain. However instead of putting his house in order by providing essential political and economic reforms, Chiang Kai- shek held firmly to his policy of reaction and his corrupt regime seems now to be approaching disaster. We know you would agree that the best way of resisting Communism is by positive action recognising the rights of people to self-government and to better economic standards of life.

7. This does not mean that we would favour British withdrawal from Hongkong. On the contrary, we feel that the British are entitled and bound to endeavour to retain their possession to vindicate their sovereignty and that for this purpose some show of force may be desirable. Moreover, we are prepared to provide certain assistance in the form of supplies and medical equipment in order that they may carry out their purpose.

8. However we have also in mind to take positive action to bring the Chinese question, so far as it involves any threat of aggression against Hongkong, before the Security Council of the United Nations so that the whole situation can be clarified. The authorities interested can be heard and so conciliation may replace force.

9. It is a very different thing however for Australia, which has important interests in this part of the world, not least of which is the prevention of a full scale war between China and other powers, to actively place itself in a situation which may drift into full scale war. We feel we must keep our hands free for the present.

10. We are not satisfied that sufficient is being done to regularise the position in China. We doubt whether there is any present intention on the part of the Communist forces in China to interfere with the territorial integrity of Hongkong. There is the danger however that over publicised measures to defend Hongkong will be interpreted as a challenge and may themselves provoke organised attack. Even reluctance to have any dealings with the Communist Government, which after all seems to be the future government of a large part of China, may provoke just the situation with respect to Hongkong and British interests in the rest of China we wish to avoid.

11. If the New Zealand Government were to proceed with the suggested offer of three frigates it will probably become necessary for us to explain the reasons why we have not taken similar action. There may be political misunderstandings and unjustified criticism. I am sure you will consider most carefully our view point before you reach a final decision.

1 Date ascertained from outward cablegram register, Volume 27.

2 Document 283.

[AA:A6768/2, EATS 70]