PRIMiE MTINISTER'S VISIT TO U. S. AND U. K.
Press Conference given by the Prime Minister, d
ir. Harold Holt, at Australia House,
London 7th July, 1966.
HOLT: There are several matters which we might cover this
mTorning but 7 thought it might be useful : if I opened up with so;: e
discussion on three topics which are of special interest to us in
Australia and which I know have attracted a good deal of attention
here. First perhaps I should say a word about how I cone to be
here at this time. I have been, thanks to their kind suggestion
to that effect, in fairly frequent direct communication with both
the Prime Minister, Mr. Wilson, and the Presicent, Mr. Johnson.
My predecessor, Sir Robert Menzies, had developed over
the years a basis of intimate consultation with successive United
States Presidents and Prime Ministers of this country and I was
delighted to fiad that both Mir. Wilson and Mr. Johnson proposed
to me when I took office that I continue with them on the same
oasis of direct personal commjunication. But even the most frank
and forthcoming exchanges of correspondence can't be an effective
substitute for personal contact. I had met MLr. A.. ilson ., hen I was
over here last year, as Treasurer, and I had not previously had
the opportunity of meeting President Johnson. So it seemed
important to the three of us that we should get to know each
other better, and this has been the principal purpose of my
journey to Europe this time.
There are several matters in both countries which we
felt we could discuss with advantage to each other. I've already
been to the United States. I m. iust say that the outcome there
exceeded by most hopeful expectations., not only have vwe
developed a closer understanding of each o. her's attitude of mindand
this was not confined to the President but I did have an
opportunity there of close consultation with Mr. McNamara,
Secretary Ball, Mr, Fowler of the Treasury, Mr. Conior of
Commerce and M! r. Averell Harriman, an old friend who has
specialised in the works of South East Asia.
I had the advantage of a very good talk with Dean Rusk,
who was in Canberra for the SEATO Conference and so, having
covered those various leading personalities of the Johnson
Administration, I feel I am not only well informed as to their
thinking but have this right up-to-the-minute. I believe it
will be useful to have soue talk with the Prime Minister based
on what I have gathered to be the views of the Administration of
the United States.
In the case of the United Kingdomi, Mr. Michael Stewart
wa. out in Australia also, of course, for the SEATO Conference
and we had a good talk together there.
2.
I'm looking forward to renewing discussion and
acquaintance with an old friend in Jim Callaghan, who laboured
as I did vith his Treasury problems -, hen we were together in
those respective capacities.
I regret that Denis Healey, with whom we had such
valuable discussions in Australia earlier in the year, will not
be here but perhaps I can catch up with hiffiaer on in the year
at the Prime Minister's Conference when it is held in this country.
Now there are three matters which call for somo better
understanding between our two governments and betwJeen our people
and the people of this country. I don't need to stress to a
British audience the warmth, friendliness, and indeed affcction
on which our relationships are based.
I've nent'oned the names of two other National Leaders
President Johnson, Mr. Harold Wilson even my ovn four-letter
name is an anglo-sacon derivation, and the three of us have come
quite obviously from Anglo-Saxon stock at so, 1ie point of tim
which should assist us to understand each other the better. And
we're not to be discourageu by plain, frank and direct speech
to each other we would feel we had less friendship for each
other than exists were we not to proceed on the basis that we can
speak freely and frankly and informatively about what is happening
in our own counetries and what is shaping our policies.
I possess, as do the rest of the people of my own
country, a sympathetic awareness and indeed understanding of the
major difficulties which the United Kingdom faces at this time
economic difficulties, problems which have carried on, some of
them, since the major effort of expenditure of wealth and huyan
resources in two great world wars where you carried so much of the
brunt of the burden of the fight for freedom. You will not find
my own country either lacking in understanding or sympathy in
the problems which have to be faced here. I come in no
complaining mood, nor, indeed, to ask for anything in particular.
I was able to say that to President Johnson.
, while there are some matters which w'e hope will be
carefully studied by the United Kingdom Govevnnient I have not come
here expecting to go back with some particular changes of policy,
but there are these matters which are worth mentioning and no
doubt others will occur to you. First South Viet Nam.
I suppose the view we bring to this matter is affected
by our geography and our circumstances, but I bring to a
European audience a view from " Down Under" where perhaps
the perspective looks rather different than the view taken from
this point of distance. We see the struggle going on in South
Viet Nam, not merely as one : n resolving an issue in that
disturbed, co-iplex country, but as one affecting South East Asia
generally and, indeed, ultimately Asia as a whole periapg even
finally the peace and economic progress and stabiliti. of the%
world as a whole.
' ie know the arguments about whether this is a Civil War
or whether the particular Administration presently in charge of'
affairs could be relied upon to maintain stability of goverryent.
The fact of the matter is that, for all its difficulty
after the Geneva accords of 195),, South Viet Nan did make steady
progress and, indeed, one of the factors influencing the
uggression from, North Viet Nai., wras the contrast betw , een the
steadily progressive South Viet Nam, with its production rising
usefully, and the failure to sustain production in North Viet Nam.
But it's not the story of a particuilar issue involving South
Viet Nam solely that would be justification enough if we were
to stand by the principles which brought my own country into
two world wars alnd saw us fighting in Korea to protect another
country under threat of coi-umist aggression at that timae. Going
beyond that, is in our judgement the future of the kind of Asia
which we have in South East Asia generally, and throughout the
world as a whole. A" nd so don't be surprised if differences of
view develop between us. de feel very strongly about this.
You will f ind those in my ow. n country who take a
different attitude but I can only point to the expressions of
public opinion, such as we ar-c able to ascertain them, which on
the last two showings have revealed. stronger support for my own.
government whose policies on this matter are so clear a degree
of support ,, hich has reached the highest point we have -known in
the history of my own Party, and this has been confirmed over the
last poll takings.
Well, they are not conclusive, as we know, but certainly
the goverinent is firma as was the govern-ment of -ay predecessor,
Sir Robert Menzies, and three successive Presidents of the United
States. It's worth remembering, that. This is not the policy
of any one man. Three successive Presidents have given support
to the policies which are now in effect in Viet Nan..
So don't find it surprising if there was disappointment
in Australia that it was felt necessary to dissociate this
country from the recent military action, taken principally on
military grounds and with the utmost care, as I know, exercised
to confine civilian damage to the barest minimum. And, surely,
if one is involved in operations of war and there is an item of
supply so basic to transportation and efficient conduct of
hostile operations against your own forces as petrol and oil
installations, that these becomae legitimate military targets.
Now we find it difficult to Lnderstand how at the same
time there can be su3port for the general policies which have
brought our own forces I'm speaking now particularly of the
American forces plus those other friendl-forces supporting
the South Vietnamese who are there in such considerable numberswe
find it difficult to reconcile that expression of support
with the criticism which came at a time when the United States
was feeling that it needed international backing for the
causes it is pursuing.
The United Kingdom has carried a considerable burden
itself in South-East Asia in order to preserve stability,
particularly in relation to Mialaysai and in containing
aggressive conduct on the part of Indonesia.
dvhen I was expressing in America the other day so.-e
critical coni ; ents on the failure of qfestern European countries
to face up to their responsibilities in that area of the world
I did not, of co: rse, have in mind the United Kingdom-which has
contributed in so many ways the military establishment it has
had in the area and the considerable civilian aid that has also
been given through the Colombo Plan and in other ways but I
used the phrase, and I don't run away from it. I used the phrase
in America that in my judgment some of the countries of western
Europe who have most cause to be grateful to the United States
for the reccnstruction of their own economies ' Tde possible by
the Marshall Aid Programme, and who themselves have the interest
that countries have internationally in stability and peace in a
substantial a'rea of the world I said of them that I believed
them to be " coasting" on the United States effort.
If the United States werc not there in its current
strength these other countries, could not afford to have Asia
turned into a coi. ummnist thiefdorm, and I would hope they could
search their minds and their consciences on this issue. It is
entirely unreasonable that this one country should be expected
to carry so much of the burden.
There are altogether, as of the last count that I could
make, some 3-countries in 6outh Viet Nai giving assistance in one
form or another, a few giving military assistance, others giving
some material assistance, and I don't think the United States is
looking for massive assistance, but it is looking for understanding
for recognition that it is carrying out a task that is of benefit
to the free world as a whole, and it would welcome the moral
support, at least, of those who have been grateful for the
strength America has brought to the struggle for freedom in two
European wars. For our own part, I-think this is the first time in the
history of my country that our owrvnorces have been engaged in
military operations in which they have not been fighting in
association with forces of the United Kingdom, and this too is
a matter for regret by us. But we have recognised the substantial
contribution the United Kingdo; m has been required to
make while the confrontation issue persisted.
Now moving from there to the issue which, in shorthand
terms, is referred to as " East of Suez", we have been thinking
not so much in military terns as we have ourselves commentedwith
concern on the growning strength of opinion which seems to
exist on both sides of politics in this country and that the
United Kingdom should reduce its influence, its interest, its
activity in that area of the world.
In the military side the discussions we had with Mr.
Denis Healey, produced a resalt that was satisf: ctory from my
own government s point of view and we had that position
confirmed and clarified, again to our complete satisfaction by
by Harold , ilson quite recently.
But its the growing body of opinion in a country which
throughout its history has felt part of the world scheme of
things, which has been able to play so often a decisive part and,
of course, sofre quently an influential part, because to us it
seems to be turning ones back on a very large part or life.
After all, there are currently 1-biliion people East of Suez
and that about half the total population of the world. Their
proportion of it is tending to grow rapidly as methods of
better hygiene, of public health, increase a life expectancy, and
this aced tI the natural fertility of the countries in the area
will produce, in all probability a doubling of that population
by the end cf the century.
There is no place, as Mr. Denis Healey said, where there
are more dangers of military operations or hostilities breaking
out, but there is no place in the world also where there is more
dynamism, more stir, more potential for growth in a variety of
useful ways. * Ive in Australia recognise the challenges but we also
see the enormous opportunities, and I woader just how far there is
realisation in this country of what is going on and what it can
mean if good fortune holds, if we are able to take advantage of
opportunities for peaceful economic progress in the future.
Let me just mention by way of illustration Australia's
situation with Japan. Since the 1950' s our trade with Japan has
increased 4. times. It runs second to the United Kingdom as an
importer of Australian goods at the moment, but on present trends
in won't be very much longer before Japan becomes the principal
customer in the world for Australian goods.
Our trade in the countries East of Suez has increased
from about 15 per cent in the early 1950' s to something over
33 per cent today and the trend is strongly upward, and so
involved militarily at a number of points involved in various
aid programmes, involved to an increasing degree in tho
organisations which are now er.,. rging in South East Asia.
SEATO, of course, has been in operation for some
considerable time, the civilian aid programies under the Colombo
plan, they have been continuing for quite some time, but we have
new organisations of which the so-named ASPAC is the most recent
example, which held its conference at Seoul with Japan, South
Korea, South Viet Nan, Taiwan, Philippines, M1alaysia, Thailand,
Australia and New Zealand, all present conducting a very useful
and s', ccessful conference together.
How many people are aware that the Asian Development
Bank looks like being successfully launched shortly with an
initial capital of a billion dollars of which the United States
wili have subscribed a couple of hundred million, Japan committed
itself to 200 million, and my own country for 85 million dollars.
Quite recently Japan concluded an arrangement with South Korea
in which 800 million dollars of credits were to be extended to
So. th Korea. In South Vietnam itself, concurrently with the military
operations, there are positive programmes of civic action, rural
development, village development going on as part of the positive,
constructive side of what is happening in South East Asia today.
Ie are ourselves engaged in prograrmmes of road
construction in Borneo, in Thailand, and these are merely
illustrations of the growing volurne of co-operation which is
occurring in that part of the world. And the events are moving
so rapidly that I am coming to the conclusion that we are more
likely to got a disj~ osition to peace on the part of the North
Vietnamese particularly if they are as much subject to influence,
as we believe, from commnunist China than the outcome of the
military ope~ rations themselves because there are intelligent
people in all camps whether behind curtaiis on one side or the
other. W4e can't divide the world sensibly into the " goodies"
and the " badu. ies". I'm convinced that there iiust be thoughtful
people in China who are realising that their programmes have been
failing in other parts of the world, they have had their se. Lious
setbacks in Africa, in Indonosia, and they can see a growing body of
co-operation in South East Asia, in particular, right round the
arc from South Korea through Taiwan, the Philippines, Thailcand.
Malaysia, our own country and New Zealand, strengthening all ' the
time, buildig up an economnic strength, and stimulated to do o
because we feel that together the thlreat of what China, unless
halted, could mean to all of us in the future.
And I think they're close to a cross-road were they've
got to make up their minds that they either join in a growing.
economic society in that part of the world or take the other
path at the cross-roads and stand aloof fro-R these developmerns
with a steady hardening of hostility toward them. Now we would
hope that they woLd have the good sense to see that the time
has come to review existing policies and what we say of communist
China goes for the coimmunist world as a whole.
I was delighted to see the initiative being displayed
by Mr. Harold W-ilson. Earlier in New York this week I was
making the point myself that vwe have to search for ways and mleans
of' making the curtains, iron and banboo, less exclusive, and make
them at least penetrable by various processes which would lead
to personal exchanges, to the development of scrie mutuality of
interest. Trade is, of course, the outstanding example of one
of the ways in which this mutuality of benefit arid interest can
be developed. My own country, despite well-known views against
communist aggression, sees nothing inconsistent in trading with
corimunist China, any more than we felt this when we kept open a
channel of friendship to Indonesia, despite the fact that we had
forces meeting theirs in their confrontation tactics.
Through Trade, tourism, more frequent visits by press
representatives, scientific and cultural exchanges, in the
variety of ways that can build up some lessening of tension
and spirit of conflict, we must take advantage of these
opportunities and I wish the Prime Minister well on his forthcoming
journey. Now the other matter which I thought I might mention
just briefly to you, because I know there is great interest
in it, is that of British capital i nvestment.
7.
British cOapital investment in Australia has been the major element
in our total of overseas investment. ffe don't wait for the
investment to come to us, 90% of fixed capital investment in
Australia derives from Australian sources.
WVe are surpassed, I think, only by Japan in the degree
to which we withhold from consumption a percentage of our gross
national product. Last year this reached 26.7%. the comparable figure
for the United States was 16.7% and for the United Kingdom 16.7%. So
you will gather from that figure that we are doing a great deal to
help ourselves. But it's the remaining 10% that has been of
tremendous importance to us, because it has imainly enabled us to
finance larger projects, new types of enterprise and has contributed
significantly to a more balanced, more highly diversified economy.
Now, over the years since the end of the war, the
United Kingdom has been responsible for nnre than half the rotal
volume of investment the figure would be well in excess of
800,000,000 sterling in that time and although the percentage has
dropped a little relative to dollar investment in recent years, the
United Kingdom is still the largest investor in our country.
One of the questions I will be discussing with the
Prime Minister is the ostimates made here of the length of time which
it is felt that these restraints should operate. I would hope to be
able to show that there is considerable benefit tothe United Kingdom
from the continuance of this investment. Evevlafe 60, C3O, 000
sterling a year contributing to your own balance of payments assets
from outside sources come from profits in Australia, and, as is wellknown,
most of our own earnings overseas, when they end up in the
form of reserves, are held as sterling reserves.
I've never felt it a very useful negotiation myself to
try to ask people just to do som~ ething for you in the absence of a
consideration flowing the other way but I think here, that in this
question of overseas -investment by the United Kingdom in Australia,
there is powerful argument in support of the view that it is in both
the current and long-tern interest of this country to keep that
process going. I want to see it going for a variety of other reasons,
and one of the most important of these is that with the investment
comes the outflow also of executive leadership and personalities
people of quality and character associated with a new enterprise.
ie welcome this as part of our own community life, and I
think of so many outstanding Englishmen who are part of the Australian
community and helping to enrich that community in the quality of
British character and the experience and wisdom that the British
people can bring to others when they associate with them.
' Ve have enjoyed that, we want to go on enjoying it. WNe
think it's important for you as well as for us that the British
influence in our community life be strongly maintained. We've been
welcoming in the post-war years a million migrants from this country
and we would also like to feel that the type oi executive or artisan
who comes to Australia with British enterprise which, in turn,
is in the statistics as an item of capital investment, thatthi. s
would continue and I shall be putting this viewpoint to the
Prime Minister.
I knaow the difficulties of my colleague, the Chancellor,
he has my sympathy. I used to say to him. " I'd much prefer to
have my own problems as Treasurer frof those of the Chancellor
of the United Kingdom." 1
We fortunately have been having a rathcr miore comfortable
experience on our own balance of payments despite the currency
of a quite serious drought, the worst we've had for just on
years, which reduced our sheep population by just on 85,, from
170,000,000 to 157,000,000 and in New S3outh , iales reduced the cattle
population by just on 255.
But fortunately the economy is diversified these days to
a point where we could take almost in stride what would have
been a disastrous experience 10 or 20 years before. And there's
the very considerable mineral projects now in process of coming
to full production and when they bring their export earning to
the total we feel that our position will become even stronger
in the years ahead.
Now the final cormment I want to leave in your minds is
that we believe that there are stirring, exciting thing,: happening
with alrmost dazzling rapidity in an area of the w orld which
contains, T repeat, just on half of the worlds population.
vie are placed geographically and, as a consequence of friendly
relations with so many countries in the area, strongly able to
take advantage of the opportunities which will develop, Ve think
its in the interests of this country to see Australia take
advantage of' those opportunities and if British capital or British
migration would pronote those purposes anid, in turn, lead to the
strengthening of the sterling area generally and the British
position throughout the world, then I'm sure that if we have the
facts and the case to support British action, we won't be
receiving an unsympathetic ear when we come to the Leaders of the
Government in your country.
Now I've taken up a lot of your time. Over to you in
case there are other subjects you would like to develop.
SQUIRE BARRACLOUGH ( DAILY EXPRESS): One of the grouses of
people over here, Mr. Holt is that Australia herself is riot
spending money on defence. Have you any com. mient to make on that?
NR. HOLT: W~ e do have a combined objective of developing a continent
the si7. e of the United States of Amierica with under 1112 million
people at the moment, but we have recognised the need to put
increasing proportion of our resources to defence.
The Treasurer told me just before I left Australia that
over the next year or two our defence expenditure would be close
to 5% of C. N. P. I think your objective is to get yours down
to ) 45 of G. N. P.
le have doubled our defence expenditure over the last
three years and this is not easy when you have the combined
tasks that-I've mientioned and it's part of the explanation
why we hav. to withhold a much larger percentage of our G. N. P.
from consun . tion than is the case in this country.
Our population growth rate is slightly over 2% o cormpared with
.8 of 1% in this country. I
I tried to make some estimate of how many more houses
you would need to build each year if you had a 2% growth rate
instead of .8 of 1% but houses, schools, hospitals and the other
amenities of a modern cor-cmunity, when they have to be provided on
double the scale in one country as against anothcr, clearly have
some bearing on what you can do in other directions at the same time.
MAJOR HIITTERHOFF ( TABLET): You painted a very fascinating picture of
the growing co-operation among the nations of a vast area from Japan
tc New Zealand. You also said that 74 countries are assisting the
United States
HOLT ( intcrjecting): 344. s
MAJOR HINTERHOFF:-3. countries assisting the United States in Viet Nam.
My question is why no advantage could be taken from these forces for
Formosa?
DER. HOLT: \ V4ell, I think the reasoning behind that can be deduced
I'm not speaking with authority or knowledge precisely of what went
on in the minds of those who resolve these things but I imagine
that this would be regarded in their ys by Chin as a highly
provocative act. If you are concerned s to whether China would be
drawn into the conflict I don't think anything would be likely to
bring China in quicker than for them to feel that this was not merely
support by Taiwan but could possibly be converted eventually into an
attack on the mainland of China itself. Certainly the Taiwanese have
been entirely willing to give support.
FISHER ( THO11PSON NE'FSPAPERS): \, hat is your feeling about the refusal of
Chancellor Callaghan to allow conipanies to operate in Australia
to let them have their headquarters in Australia, such as N~ w Broken
Hill?
KilR. HOLT: This is a matter of discussion likely to arise between
us. Possibly the main burden of the discussion will have to be borne
by my colleague, the Treasurer, when he is across a little later in
the year, but we feel that with the activities being carried on in
Australia it's a reasonable thing that taxation should be levied at
that source. But I'm not going to try and pre-judge any particular
case. We are dealing with fair-mird ipeople, and if we have a case,
then we should be able to secure satisfaction from it. I notice that
one decisi'n recently affecting one of the gold-mining companies took
a favourable view from Australia's standpoint.
MURRAY ( LIVERPOOL DAILY POST): You described the attitude of the United
States when you elaborated on point 1. Can we assume that this is
what President Johnson told you?
,1R. HOLT: You can assume that th. s is the assessment I have
gathered in my discussions with IMembers of the Administration, but
I'm not going to discuss individual Members or their views.
I don't think I would need to be a James Bond to convey that
intelligence to the United Kingdom. I'm sure they have assessed
that for thezselves.
LL1E, ( SUN): You seem to have expressed some regret that British
troops aren' t fighting alongside the Australians and Americans
in Viet Nap.. If I read you right, do you think Vhat they should be,
especially as some British troops are go1ig to * be released from their
duties in the Malaysia-Indonesia set-up?
Mt. HOLT: I mentioned as a matter of historical fact that this was
the first occasion tlat there has been a very effective use made of
British troops in the confrontation problem and we have understood
right through the piece that these farces, having been built up
1l: rgely to iieet tlhLc confrontation issue, would be reduced after that
issue had been satisfactorily resolved. It's a little early to say
that it has, as a matter of fact, I think, but developments are moving
in the right direction. I am not aware of any finality of judgenent
to which the United Kingdom has coi~ le as to the disposition of its
forces subsequently. One matter on this which I think might be touched on,
and that is the view which seems to be held in some quarters here,
anyway, about Thailand, that somehow or other Thailand is not
entitled to the same support because the form of government it
possesses doesnt appeal to some people. I've seen a good deal of
the Leaders of the Government of Thailand. This year we had a visit
to Australia from the Prime Minister, Mr. Thanom Kittikachorn, and
Mr. Thanat Khoman his very able Foreign Minister and Pote Sarasin,
who was for some years the Secretary-General of SEATO and then,
having goiie myself to South Viet Nam~, in the course of a journey I
made to adjacent areas, I returned that visit.
It was a symptom of the growing, spirit of cooperation
that I spoke of earlier that I was invited as the first
foreigner in Thai history to sit in the Cabinet with their government,
and from what I have learned personally in my associations with
these men we are fortunate that there is such a capable body of men
at the present time in charge of a Government that is playing such an
increasingly influential role in the area.
You may have noted that the Thais provided the venue
for consultations between Mr. Malik of Indonesia and Tun Razak
of Malaysia, and they were active in this recent conference in
Seoul, in a variety of ways over recent months they've made a very
useful contribution. It may be that they have a form of government
which is a military dictatorship, but if the Prime Minister were to
conduct a general election on the same basis as ourselves I think
he would poll something over 90 per cent of the vote.
He's a-very popular leader in his own country, hi*
owni country is making very good progress, it has greatly
strengthened itself economically, and recently they have decided
upon a degree of military participation in South Viet Nam.
So I wo!_ ld just utter a word of caution against being
critical of the Government or allowing that to become a foundational
aspect of policy determination.
They can make, and will make, I think, a growig
contribution of strength and economic prcgress and stability in
South E~ ast Asia.
11.
STOKES, ( BBC CUR1ENT AFFAIRS): 14r. Prime Minister, you've referred
to the growing size mnd importance of coummunist China, and to
the need to search for ways and means to make the iron and the
bamboo curtains more penetrable. Does this mean that your
government is re-considering its attitude towards the reco. gnition
of China, and its admission to the United Nations?
MR. HOLT: Well, when you say reconsidering it, that matter had been
considered on a number of occasions. My own view has always been
that this qu.-stion is one which ought to be resolved in a wider
settlement, a more gcnieral arrangement it which wie would have . a
clearer view of the future intention of conaiiunist China. There is
the problem of the Taiwanese, Australia would certainly not be
sympathetic towards a-result which abandoned the Taiwanese, and
th~ re are complications which have to be borne in our thinking
and our accounting, but we haven't got a closed mind on this matter.
But while we have people maintaining philosophy in which they are
talking about power growing out of the barrel of a gun and that
wars of national liberation can be the pattern for expansion of
cormxanist influence generally throughout the world, it seems a
little odd that you are embracing them.
STOKES: Not embracing, recognising.
MvIR. HOLT: Recagising aell, we sell them a lot of wheat and
wool, we recognise them to that extent.
MONKS, ( SYDNEY '. t,-1ORNI\ IG HERALD): MP.' r. Prime Minister, Tun Abdul
Razak has been saying today that he and Mr. Healey have agr'eed on
measures for the withdrawal of British troops from Sabah ard
Sarawak. Has Australia been consulted on this, and have you any
coif.!. ents to make on the scale of possible British withdrawals
from this region?
MR. HOLT: Viell, you can take it that Australia is closely
consulted on whatever happens around that area, not only by the
United Kingdom Government, but we are on very friendly and close
terms with the government of Malaysia so you can safely assume
that whatever is going on there you will ae pretty well informed
about but I'm afraid I've not been directly in contact with
the latest developments myself, so I can't give you a precise
answer to your question.
CORBET ( TIMES): Last year, Prime Minister, you took quite a lead
in asserting the right of the less industrialised nations to
be heard on the question of an international liquidity issue.
Could you give us your reactions to the mneeting of cohmion market
ministers in Rom~ e which decided th: t there should be no increase
in the world's monetary resources until the United States ard.
British deficits had been eliminated a view which was
subsequently endorsed by the group of ten deputies meeting
in Frankfurt, and could you more generally give as your views
on how these discussions have been going?
1-2. HOLT: The general views of the Government have not changed
since I expressed them last year.
12.
This question of international liquidity concerns us
all because it seems to me to be unnecessarily fouled up by
these attitudes in Europe arnd elsewhere. In other words you
don't get the feeling that it is being faced in a completely
objective way. Now we have always supported the fund as the
principal source for leadership and guidance on this issue and
ior that reason you do tend to get a broader, more objective
view of requirements than would be taken by some special group
which had its own interests principally and almost exclusively
in its thinking.
CORBET: In short, you would like the whole matter taken out
of the hands of the committee of
MfR. HOLT: We have all along asserted that the final responsibility,
or at least the judgement on this matter, should rest with the
fund rather than with any more limited group, and indeed the
substance of my speech last year at the meeting was that the
countries and there are more than 100 of us altogether
against, say, the ten that you are speaking of they hfAve
interests as well in this question, which can be better
protected by the fund than by any other body we can point to.
Q. Would you mind clarifying your remarks when you said
you thought China was very close to the cross-roads where you
felt it must join the economic society of the area. Do you
envisage it as a member of the Asian Dievelopment Bank or Aspac?
MvlR. HiOLT: No, I didn't say that was the thinking of the Chinese
themselves. What I'm saying is that these co-operative
organisations, the spirit of collaboration in friendly trade
and that. sort of thing this is developing so fast, in the area
and the projections of trade trends tend to confirm this that
the Chinese must surely be giving some thought to whether they
can afford this process to continue in such a way that you have
regional associations from which they are excluded, strengthening
the economies of these other countries and the other
countries having a unity of interest which currently is as much
based on 10: ncn bot.!-rcr.' sao as any other factor.
They could find themselves in ten years' time from now the odd
man looking out against the r. st of Asia.
Q. When you spoke about the Western nations " coasting"
along on America, did you include France especially?
1R. HOLT: Well, I don't think it needs much specification by
me to range over a number of countries and certainly France was
one which greatly benefitted from the marshall aid reconstruction
programme and we very much regretted that France has not been
able to give support to American efforts and has indeed been
hostile to them.
Now I don't know by what process of Gallic logic
this has been decided but the United States is justifiably
disappointed that there has been so little thought given when
in principle they find as we find it hard to distinguish
between the issues which arise in South Vietnam and the issues
which arose in West Berlin and if it was justifiable for my
small country to have nearly half a million casualties in two
world warj to defend countries against aggression in Europe,
and the United States paid hea. vily in those world wars also for
a struggle fought thousands of miles from their shores, we
would have expected a rather more sympathetic understanding.
Wec do not go into these matters lightly nor unless we are
convinced that great issues are at stake and must be defended.