FOR HIGH COMMISSIONER

Reference your No. 357. [1] Netherlands East Indies. Please convey
following information to United Kingdom Government:-

(Begins) On 16th May, 1940, Consul-General of Japan [2] called on
Minister External Affairs [3] and on behalf of his Government
requested attitude of Commonwealth Government towards Netherlands
East Indies. Minister invited attention to declaration he had made
in Parliament on 15th May to the effect that Australia as Pacific
Power was vitally concerned in maintenance status quo of
Netherlands East Indies and for its part would take no action
likely to affect present position. Minister added this was view of
Commonwealth Government.

Consul-General expressed gratification with this declaration and
stated he would communicate it to his Government. He added this
was also attitude of Japanese Government, and Consul-General gave
assurance to that effect.

Discussion then ensued as to general position in Europe and
question was raised as to press report of naval understanding
between Italy and Japan. Consul-General denied any such
negotiations were in progress or contemplated. He further stated
that on 10th May Japanese Cabinet had reaffirmed decision of
previous Government that Japan would maintain policy of strict
neutrality in present European war and would not enter into any
entanglement or involvement with any European Power at the present
time.

Minister asked if he could make use of this in any public
statement or answer to question in Parliament. Consul-General
answered 'Yes' as that was the decision of Japanese Government,
and he repeated his assurance to this effect. (Ends) [4]

MENZIES