1. Your Johcu number 14. [2]

General Wavell's [3] command area is limited to the fighting zone
where active operations are now proceeding. Hence it does not
include Australia, New Zealand and communications between the
United States and Australia or indeed any other ocean
communications. This does not of course mean that these vital
regions and communications are to be left without protection so
far as our resources admit. In our view the American Navy should
assume responsibility for communications to the eastwards
including islands right up to the Australian or New Zealand coast.

This is what we are pressing [for]. Admiral King' has just been
given full powers over the whole of the American Navy and he has
not yet accepted our view. Obviously, if I cannot persuade the
Americans to take over, we shall have to fill the gap as best we
can but I still hope that our view will be accepted in which case
of course any vessels we or you have in that area will come under
United States direction while operating there. There never has
been any intention [of making a] main allied concentration in the
newly defined southwest Pacific theatre and I do not know where
you got this from.

2. I [now] sen[d] you the letter of instructions to General Wavell
[5] which has been agreed to by the President [6] and the American
Chiefs. [A statement upon the Wavell appointment will be made
public shortly, and I will see you get it in good time for
synchronisation of release.]

3. Your telegram 166 of 29th December. [7] The Staff appreciation
to which you refer was prepared in London and, like all documents
of this character, constitutes a general survey of the situation
rather than final plans for action. It is in any case largely
superseded by the appointment of Wavell as Supreme Commander.

Nevertheless I have laid it before the Chiefs of Staff who are
with me here and I have no doubt that they will take to heart the
various comments you have been good enough to make upon it.

4. Night and day I am labouring here to make the best arrangements
possible in your interests and for your safety, having regard to
other theatres and other dangers which have to be met from our
limited resources. It is only a little while ago that you were
most strongly urging the highest state of equipment for the
Australian Army in the Middle East. The battle there is still not
finished though prospects are good. It would have been folly to
spoil Auchinleck's [8] battle by diverting aircraft, tanks etc. to
Malay Peninsula at a time when there was no certainty that Japan
would enter the war. The eas[ing] up of the Caucas[us] danger
through Russian victories and Auchinleck's successes have made
possible the considerable reinforcements, at the temporary expense
of the Middle East, of which you have been advised and which are
also justified because Malaya has now become a war theatre.

5. I have been in close consultation with Casey [9] who has been
of great help in presenting your view and anxieties.

6. I also send you in my immediately following telegram [10] a
note by the First Sea Lord [11] on the Naval aspect of the Pacific
war which, as you will see, is very different from what would have
prevailed before the power of the air became so dominant.