Charting a new course : Southeast Asia in a time of change : a report

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Title:
Charting a new course : Southeast Asia in a time of change : a report
Physical Description:
v. : ill. ; 24 cm.
Language:
English
Creator:
Mansfield, Mike, 1903-
Mansfield, Mike, 1903-
Mansfield, Mike, 1903-
United States -- Congress. -- Senate. -- Committee on Foreign Relations
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U.S. Govt. Print. Off.
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Washington
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Foreign relations -- Southeast Asia -- United States   ( lcsh )
Foreign relations -- United States -- Asia, Southeastern   ( lcsh )
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non-fiction   ( marcgt )

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Additional Physical Form:
Also available in electronic format.
General Note:
At head of title: 94th Congress, 2d session. Committee print.
General Note:
"Report number three."
General Note:
Includes as appendixes his reports 1 and 2, also issued separately under titles The end of the postwar era, and Postwar Southeast Asia.
General Note:
Issued Dec. 1976.
Statement of Responsibility:
by Mike Mansfield to the Committee on Foreign Relations, United States Senate.

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University of Florida
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All applicable rights reserved by the source institution and holding location.
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aleph - 029298552
oclc - 02662401
lccn - 77600567
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lcc - DS518.8 .M23
ddc - 327.59/073
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Full Text



94th Congress COXXITTEE PRINT







SCHARTING A NEW COURSE:

SUTHEAST ASIA IN A TIME OF CHANGE





A REPORT

BY

SENATOR MIKE MANSFIELD
MAJORITY LEADER
US. SENATE

TO THE



UNITED STATES SENATE



REPORT NUMBER THREE








DECEMBER 1976


Printed for the use of the Committee on Foreigfi-elti


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95 WASHINGTON : 1976
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COMMITTEE ON FOREIGN RELATIONS
JOHN SPARKMAN, Alabama, Chairman
MIKE MANSFIELD, Montana CLIFFORD P. CASE, New Jersey
FRANK CHURCH, Idaho JACOB K. JAVITS, New York
STUART SYMINGTON, Missouri HUGH SCOTT, Pennsylvania
CLAIBORNE PELL, Rhode Island JAMES B. PEARSON, Kansas
GALE W. McGEE, Wyoming CHARLES H. PERCY, Illinois
GEORGE S. McGOVERN, South Dakota ROBERT P. GRIFFIN, Michigan
HUBERT H. HUMPHREY, Minnesota
DICK CLARK, Iowa
JOSEPH R. BIDEN, JR., Delaware
PAT M. HOLT, Chief of ftaff
ARTHUR M. KUHL, CMhf Clerk
(II)
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CONTENTS

Page
Letter of transmittal...------------ v
Text of the report -- ----------------------------------- 1
I. Introduction ----------_ ------ 1
II. Philippines------- -- --------- ------ 3
III. Indonesia ----- --------- --- 6
IV. Malaysia---------- --------- ---------- -- 11
V. Singapore-- ---------- ------------12
VI. 4Papua New Guinea------------14
VII. Concluding comments -----------16
Appendixes:
1. "The End of the Postwar Era: Time for a New Partnership of
Equality With Japan," report by Senator Mike Mansfield to the
Senate Committee on Foreign Relations--_ __---_ 19
2. "Postwar Southeast Asia: A Search for Neutrality and Independ-
ence," report by Senator Mike Mansfield to the Senate Com-
mittee on Foreign Relations ------------------------------ 79
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LETTER OF TRANSMITTAL

DECEMBER 10, 1976.
Hon. JOHN SPARKMAN,
Chairman, Committee on Foreign elations,
U.S. Senate, Washington, D.C.
DEAR MR. CHAIRMAN: Transmitted herewith is a report of my
final official mission abroad as a United States Senator. It contains
observations which result from a series of visits this year to various
parts of Asia and the Pacific.
During July I spent eight days in Japan following which I sent
Mr. Francis R. Valeo and Mr. Norvill Jones, who accompanied me,
to Korea and Taiwan, respectively, to obtain current information
concerning issues relating to those countries. A report of that study,
"The End of the Postwar Era: Time for a New Partnership of
Equality With Japan", was filed with the Committee and is included
as an appendix to this report. In August, I traveled to Thailand, Laos,
and Burma to view the situation in that part of Southeast Asia. My
observations as a result of that visit were reported to the Senate in a
speech on August 26, which is also included as an appendix to this
report.
The third segment of my travels to assess the current scene in Asia
was to the People's Republic of China where I spent three weeks during
September and October. My observations on China were transmitted
to the Committee on November 18. After leaving China, I visited the
Philippines, Indonesia, and Papau New Guinea.
In the Philippines I met with President Ferdinand E. Marcos and
officials of the Ministry of Foreign Affairs; in Indonesia I conferred
with President Suharto, leaders of Parliament, and met informally
with other government officials; and in Papau New Guinea I had
informative talks with Acting Prime Minister Sir Maori Kiki and
also had opportunity for discussions with other local officials. In each
country I also received briefings from the staff of the local U.S. Mis-
sion. While in Indonesia, I received a briefing on developments in both
Malaysia and Singapore from officers of the United States Embassy
in each country who met with me in Jakarta for that purpose.
This report contains both observations on the non-China portion of
my last mission and some observations on the general situation in
Asia.
I was accompanied on the trip by Senator John Glenn and his wife,
Anna, both of whom contributed greatly to the mission. I wish to
(V)





VI

express my appreciation to the Department of State and to the U..
missions in ech country visited; the Department of the Air Force
for transportation; Deputy Assistant Secretary of State Victor
Dikeos for his efficient handling of logistics and ther details, my
assistant Mrs. Salpee Sahagian and Senator Glenn's secretary, Miss
Kathy Prosser, for their able and willing help at all times; Dr. Thomas
Lowe of the Navy Medical Corps for his services; Mr. Francis R.
Valeo, Secretary of the Senate, Mr. Charles R. Gellner, Senior
specialist in Foreign Affairs of the Congressional Research Service,
Library of Congress, and Mr. Norvill Jones of the staff of the Com-
mittee on Foreign Relations, for their assistance.
I also wish to express special appreciation to my wife, Maureen, for
her usual valuable contribution.
Sincerely,
MIKE MANSFIELD.











CHARTING A NEW COURSE: SOUTHEAST ASIA IN A TIME
OF CHANGE


.I. INTRODUI O
Since President Nixon's visit to Peking in 1972 winds of change
have swept Asia. It is in Southeast Asia that those winds have blown
the strongest, increasing in intensity as a result of the 1975 collapse of
the U.S-supported governments in Indochina. Nations in the region
are making major reassessments of their relationships. Nationalism,
neutrality, and a growing interest in regional cooperation are the sig-
nificant factors at work. The Association of Southeast Asian Nations
(ASEAN), formed in 1970 by Indonesia, Malaysia, Thailand, the
Philippines, and Singapore, has been the principal vehicle for ad-
vancing regional cooperation. Two underlying principles have con-
tributed to ASEAN's success to date, a common readiness to refrain
from trying to force agreement on contentious issues and a policy of
avoiding becoming identified with any major power. Gradualism and
a recognition that the ihterests of member states differ have governed
the group's cautious approach. As an organization its goal is not to
become a super-state but something of a club to promote common
interests.
In April 1976 the heads of state of the ASEAN nations, meeting on
the Indonesian island of Bali in the organization's first summit meet-
ing, signed a Treaty of Amity and Cooperation which, among other
things, created a mechanism for settling regional disputes. At this
meeting, for the first time, ASEAN was given an explicitly political
character. A secretariat for the organization has now been opened in
Jakarta, in keeping with the keystone role Indonesia, as the most
populous of the member nations, expects to play. To date, there has
not been any formal contact between ASEAN and the United States
although there has been a limited formal dialogue between the orga-
nization and the European Economic Community as well as with
Japan. The question of direct contact with the United States is sensi-
tive because of Indochinese suspicion that ASEAN is a tool of Ameri-
can interests.
No regional issue concerns ASEAN nations so much as the inten-
tions of Vietnam, now the strongest military power by far in the
region. Last July Phan Hien, Deputy Foreign Minister of Vietnam,
visited throughout the region in an apparent eot to establish closer
bilateral relations with te non-Communist nations in the area. How-
ever, in September, at the Colombo Non-Aligned Conference, Laos,
supported by Vietnam, succeeded in defeating a Malaysian effort to
win the Conference's endorsement of a Southeast Asian zone of peace,
freedom and neutrality. During the conference debate Vietnam's
Foreign Minister Nguyen Duy Trinh sought to assure the ASEAN
(1)





2

representatives that its support for Laos' position should not be in-
terpreted as a change in its policy to seel i of
with nations in the area. Nevertheless, Laos' action, founded on linger
ing suspicion that ASEAN is a covert device for continued A can
intervention, rearoused fears over Vietnam and its Indochinese allies'
intentions, concerns that had somewhat quieted by Phan Hien's
earlier visits. But the surface reaction was mild and, wit the excepi
of Thailand where the October military coup changed the picture, the
trend toward easing tensions between ASEAN nations and Vietnam
continues. Some observers see ASEAN-Indochina relations developing
along lines of the economic cooperation between Western and Eastern
Europe, envisioning economic ties between the two groupings to that
extent.
Thus far China has taken a detached view of ASEAN but no doubt
would view with concern any tendency to convert the organizati
into a military alliance. Until the recent coup in Bangok, China's
relations with Thailand were warming rapidly. Since then a distinct
chill has set in. Relations between China and the Philippines
good and with Malaysia they are correct but cool. Indonesia, which
suspended diplomatic relations with China following Sukarno's ouster
from power, is still watching and waiting to restore contact, fearing
the possible impact an official Chinese presence could have on its
Chinese community. Singapore waits a move from Indonesia. Taiwan
has no embassies in the ASEAN countries but any step by China to
take Taiwan by force would be seen as an upsetting development
throughout the area.
Although ASEAN has not yet settled any of the inter-regional dis-
putes that vex the region, such as the dormant Philippine claim to
Sabah and the Thai Muslim separatist movement, the growing value
all members attach to ASEAN harmony and goodwill helps dampen
down these old disputes and may have kept new ones from arising.
Progress by ASEAN on economic cooperation has been slow,
primarily because the member states are at different stages of develop-
ment. The more developed members, Singapore and the Philippines,
favor a regional free trade policy in which they see themselves as the
bankers and manufacturers for the rest of the area. The less developed
members, led by Indonesia, wish to protect their own developing in-
dustries and are wary of penetration by trans-national enrprises,
which tend to be dominated by the overseas Chinese.
Specific ASEAN industrial projects are being developed. Basic
agreement has been reached on building plants to serve area-wide
needs for fertilizer, soda ash, and diesel engines. However, many d-
tails remain to be worked out on these projects, including the funda
mental question of tariff preferences for the products. An initial step
toward cooperation n regional banking matters was recently taken
when the first ASEAN Bankers Conference agreed to establish an
ASEAN Bankers Council whose objective would be "to formulate
policy for coordination and cooperation amon ASEAN bankers for
the development of the ASEAN region." The first concrete act was
agreement to set up a regional bank clearing arrangement. These steps,
small though they may be, are building blocks for cooperation on other
matters of common interest.
A strong economic development oriented ASEAN, tied to o major
power, could be an important factor in the future of Southeast Asia.





3

United States policy should be to encourage regional cooperation but
to refrain fro trying to force the. pace or direction of the movement.
As a result of past American policy in the region, principally the
attempt to create non-neutral regimes which were strictly aligned in
policy with the United States, nations now find it disadvantageous
to bp identified too closely with U.S. interests. What the United States
needs in Southeast Asia over the long run are not weak nations tied to
American pursestrings but independent, neutral nations which coop-
erate to advance common, peaceful objectives. In the interest of
regional stability and world peace, cooperation between the nations of
ASEAN and Vietnam, Laos, and Cambodia is much to be desired.
Perhaps eventually Burma can be brought into such an arrangement.
However, strong animosities still exist within the region, centering on
Thailand and Vietnam. Thailand's role in the Vietnam war makes it
highly suspect to its Indochinese neighbors and the long history of
troubles between it and Burma places it in a key position for encourag-
ing or discouraging the expansion of regional cooperation.
The October coup in Thailand was a serious blow to budding efforts
to heal the war wounds with the nations of Indochina. In the name
of stability, a situation has been created that may well lead to in-
creased instability. The departure of American forces from Thai bases
three months before the coup was a sound move for both Thailand and
for long-range American policy in the region. There is no justification
in terms of our national interest, intelligence gathering or otherwise,
which could possibly warrant the return of an American military
presence to Thailand. An resumption of U.S. operations in Thailand
would inevitably be used to tiethe United States to the policies of
the current military regime. The discontent of poverty cannot be
cured by guns and the efforts to do so promise only further rebellion
in the poor, neglected rural areas.
The United States is still tied to Thailand by the moribund SEATO
Treaty. One of the first priorities of the new Administration should
be to review this vestige of our misguided post-World War II policy
in Southeast Asia before it gets the nation into further difficulty.

II. PHILIPPINES
Following my 1975 visit to the Philippines I reported to the Com-
mittee that:
The Philippine Republic is experiencing a period of growing national assertion
and economic progress. At the same time, its ties with the United States which
go back three-quarters of a century are in transition. What is involved in this
transition of principal concern to the United States are the vestiges of the
previous dependency relationship which, in my judgment, no longer accord with
the enduring interests of either nation. There is a need for a reshaping of atti-
tudes and arrangements which will reflect the changes that have taken place
within the Philippines and in the Pacific and the world. The future of the
Philipines is bright and so, too. can be te outlook for continued cooperation
and beneflal interchange with the United States if the adjustments which are
now required are made in good time and are managed with sensitivity and
unulerstanding-on both sides.
The Philinpines is now charting a course of indeDendence and
neutrality which seeks to mnintain good relations with all of the major
powers and identify the Philippines with the Third World. Self-
reliance and national pride are stressed, exemlified in the nation's





4
rejection of external assistance following the earthquake and tidal
wave which struck the Philippines last August
The yar 1976 marked the fourth of martial law
Ferdinand E. Marcos. There seems to be no widespr srr i
Philippines over the loss of the prior system. Martial law a to
be tolerated by most. A measure of law and order has been brought
about and there has been the beginning of a cd a
deep-rooted social problems. A great handicap of the the l
of a sense of national identity, is being tackled and a l pde
stimulated in various ways. Technocrats in the government are
given greater authority and recgnition and more expertise is eing
sought to bring to bear on social problems.
The Muslim insurgency in the southern islands is less an active
problem than in the past but it continues, as does the Communist in-
surgency in Central Luzon. The insurgencies are an economic, finan-
cial, and political drain on the government. The bulk of the Philip-
pine army is tied down on Mindanao and nearby islands. The level of
military activity has been reduced but, to date, there has been no real
political dialogue between the government and the Muslim insurgents
or political and economic change sufficient to satisfy the Muslims. It
was recently agreed, however, that talks with the insurgents would
commence through the auspices of Libya which has been a factor in
financing the Muslim revolt. This is a hopeful sign and may possibly
result in progress toward a solution to the dispute.
As to the general economic situation, the Philippines had a $1.2 bil-
lion trade deficit in 1975, a situation that is expected to continue for
the next several years. Increased petroleum prices have taken a heavy
toll on the Philippines' balance-of-payments situation with the cost of
petroleum imports rising from $245 million in 1974 and to an esti-
mated $1 billion this year.
The economic growth rate for 1976 will be approximately 6 per-
cent while inflation is running at about 5.4 percent, considerably bet-
ter than in 1975. The World Bank has estimated that in the 1980's the
Philippines will need $9 billion in external financing above retained
earnings but the country's debt-service burden is already high at 16
percent of exports and is expected to increase to 18 percent by 1980.
One of the most difficult problems facing the Philippines is the
brain drain. The Republic has a very literate population and a well-
trained managerial class but there is an outflow of trained Filipinos.
It is estimated, for example, that there are some 25,000 Filipino
doctors and 45,000 Filipino nurses in the United States. A developing
country cannot afford such a loss and must find ways to stem this out-
flow of talent.
A rapidly growing population is one of the many problems facing
the Philippines. From a population of 20 million in 1946 the number of
Filipinos has escalated to 43 million today and the total is expected
to reach 85 million or more by e turn of the century. Forty-three
percent of the population is now under 15. Pressures are already such
that some 700,000 to 800,000 jobs are needed each year for new job
seekers and that requirement will grow to about one million by 1980.
There is in these projections a great potential for discontent among
young people over the next 10 to 15 years.
Food constituted some 10 percent of total import This yr, how-
ever, the Philippines became self-sufficient in rice, thanks primarily





5

to new strains of miracle rice, an improved farm credit system and
other agricultural reforms. It is also self -sufficient in white corn. There
is still a substantial shortage of feed grains. Large imports of wheat
So f products, amounted to some $242 million in 1974. The
simple fact is that the Philippines must grow more food for more
people on less land in the years ahead. In 1900 there were four hectares
1of 8nd per person; now there are less than .8 per person.
Psident Marcos was an early advocate of family planning and
hi government recognizes that rapid population growth is the major
imp m t to economic and social progress. Public awareness of the
population problem is great but, thus far, the government's emphasis
on ily planning has been in the cities although 70 percent of the
people live in the rural areas. In five years the number of family plan-
ning clinicshas gonefrom zero to 2,400.
As for economic relations between the United States and the Philip-
pines, Laurel-angley agreement which set the framework for
r tions ween th two countries in the postwar period expired two
rs ago and no successor areement has been negotiated. In 1975 the
Philippine exports to the United States were $655 million, smaller
than the previous year because of lower commodity prices and smaller
sugar imports. United States exports to the Philippines increased to
$74 million bringing about a favorable balance for the United States
r t irst time in many years. The United States is the Philippines
ond la t trading partner after Japan. Japan has also replaced the
Unitd Statess the leading investor although U.S. investments in
the period from 1970 to 19 were dou that of Japan. The total mar-
ke value of U.S. investments is some $2 billion, although they are
only $1billion at book value. Little American capital is now going
into the Philipnines except for investments in banks.
There have been informal tlks betwen the twocountries about a
successor agreement to the Lautrel-Langley agreement. The Philip-
pines is interested in trade concessions while the United States' pri-
mary interest is in investnt guaranties. The talks have now been
susnended but are expected to resume in 1977.
Bilateral relations between the United States and the Philippines
are presently focused on the base negotiations which began in Wash-
ington last April and movd back to the Philippines in June. The
continued presence of the bases nuts the Philinpines in something of
a difficult nosture vi-a-vis ASEAN goals of independence and neu-
tra the Phi ines' of seeking a ul-identification
with the Third World. However, Filininos recognize that the bases
serve important mutual interests. The Chinese, concerned over Soviet
influence in te P c, appear content to see the bases remain. I was
told by one Chinese officialin Peking:
We believe it is always not a good thing to have forces stationed on foreign
soil. It seems your situation is also a result of the fact that you have interests
to As to how you go about that, it is a matter for you to decide.
Clark Air Base is the largest overseas military base of any country.
The Subic Naval Base, a ma ior station for servicing the Seventh
Fleet, is the most importnnt U.S. naval base west of Hawaii U.S.
militurv strategists consider the bases indispensible to a continued
U.S. military presence in the Western Pacific. Some 16,000 U.S. serv-
icemen aro stationed on the bases, and they are ioined by an additional
7,000-20,000 more at any one time from fleet units calling at Subic Bay.







Substantial sums are added to th Piippines' e t
$142 million last year, not including the multiplier effect othe spend-
g. The acreage ocupied by the bases is so vast that some 46,000 acres
at Clark have been surplus to U.S. military needs for years. It is said
that squatters on land at Clark rais sugar cane valued some $10
million annually. Work that can be done at Subi c
day compared with $100 per man day for U.S. facilities in Japan a
$200 per man-day in United States shipyards.
Both the United States and the Philppines ni t
Base Agreement is obsolete. This agreement gives the United States
the freest use of any foreign base in the world and, in effect amounts to
a grant of extraterritorial rights. It is this question which is primarily
at issue in the base negotiations. Other issues include financial y-
ments, manner of usage and restraints on personneIn brief, the
problem is to attune the U.S. presence to the Filippino drive for ull
independence. One related problem concerns taxation of on-b com-
mercial activities. The exchanges at the two bases do $65 million w
of business annually and goods passing through them often end up on
the black market thus evading Filipino taxes, an operation that is ex-
tensive and well organized. It is said that an item which sells for one
dollar in a base exchange will bring $2.50 on the black market.
The base negotiations are likely to remain in limbo until the new
Administration assumes office in January. I am confident that satis-
factory arrangements can be worked out thereafter. There are im-
portant mutual interests to be served by retaining the bases and on
this common ground an agreement can be reached.
A matter of special note involves the Spratley Islands which lie to
the West. With oil exploration a matter of growing regional friction,
the islands are a potential source of difficulty in view of the existence
of the U.S.-Philippines Mutual Securtiy Treaty. The Philippines Re-
public lays claim to the Spratleys as does the People's Republic of
China, the Republic of China and Vietnam. There are troops from the
Philippines, the Republic of China and Vietnam on one or more is-
lands. A clarification or reconciliation of these claims without delay
would seem to be in the interest of all concerned.
III. INDONESIA
Winds of change blow moderately in Indonesia, a land of 135 mil-
lion people scattered among more than 3,000 islands extend East to
West over a distance of 3,200 miles. Indonesia is the largest nation i
Southeast Asia and the fifth most populous in the world. It i strate-
gically located between Australia and the Asian mainlnd astride the
sea lanes that link the Pacific and Indian Oceans. Continued un-
hindered transit of shipping through these waters is important to UTS.
interests and is vital to Japan, for whom these waters are a lifeline to
Europe and the Middle East.
Indonesia is a founder of the non-aligned movement. It is destined
to play a leading role in Southeast Asia and throughout the developing
world. Since Sukarno's fall from power a decade ago Indonesia has
pursued a pragmatic approach to foreign policy. The stress has been
on economic and social development as the best insurance of regional
peace and security and the curbing of Communist influence. While





7

Indonesia frequently disagrees with U.S. policies, it has favored a
cooperative approach toward the United States and other developed
countries, opposing the confrontation tactics of many of the develop-
ing nations.
Led by men whose fear of Communism remains strong, Indonesia is
taking a cautious approach toward relations with China and Vietnam.
Although there are differences of viewpoint, the government of Presi-
dent Suharto has no present plans to resume diplomatic relations with
the People's Republic of China which were suspended following
Sukarno's fall and President Suharto's rise to power. There are deep-
seated fears over the impact that a Chinese diplomatic presence could
have on the three million local Chinese, especially in view of
the fact that nearly one-third technically hold citizenship in the Peo-
ple's Republic of China. Indonesia is not concerned about direct
action by China, but it is apprehensive over Hanoi's intentions, and
is especially worried about the smuggling of arms into the country.
As the most populous and powerful member of ASEAN, Indonesia
sees the organization as a device to further regional economic progress.
It is well aware that any attempt to bind ASEAN to military purposes
would run against the tide in Southeast Asia. Indonesia contends that
it is opposed in principle to any foreign bases in the region, but defers
to the Philippines for handling the question of U.S. bases.
Indonesia has absorbed what was once Portuguese Timor. Following
the outbreak of fighting among political factions in Timor in August
1975, the Portuguese lost effective control. A dominant position was
assumed by the anti-Indonesia Fretelin group. Indonesia became con-
cerned that an independent t E Timor would constitute a threat to
Indonesia's security by providing an opening for Communist influence
and subversion. Indonesia began to provide assistance to local groups
opposing Fretelin. Indonesian "volunteers" landed in Timor and
rapidly pushed the Freteline forces out of the main population centers.
A provisional government was established which petitioned Jakarta
for incorporation of East Timor into Indonesia. Follwing Parliamen-
tary apprval, East Timor formally became the 27th Province of In-
donesia on July 17,1976.
There are currently infrequent reports of small-scale guerrilla ac-
tivity by Fretelin units in isolated areas of East Timor, but Indonesian
forces are rerted to b gradually bringing this under control. U.S.-
supplied military equipment was used by Indonesian forces in the
operation. without U.S. permission. That points up again a continuing
problem in the enforcement of U.S. security assistance laws, a
problem which deserves early attention by Congress and the new Ad-'
ministration.
The Present party system in Indonesia reflects an effort to remove
the political focnu from Indonesia's deep ethnic and religious cleav-
ages and to establish program-oriented politics. Former parties which
accentuated these cleavages have been absorbed in two new organi-
zations, the Development Union Party (PPP), composed of various
Moslem groupings, and the Indonesian Democratic Party (PDI),
composed of two Christian and three secular groupins. Concurrently
the government has actively supported a new federation of functional
(youth, Labor, farmer, women) groups called Golkar. This organiza-







tion won 2.8 percent of the votes and 65 t
in the 1971 election and is generally regarded as the civilian succes-


pointed members. Although Parliament seldom reje
proposals it does have a voice in formulating them through prior
committee consultations. The next parliamentary elections are sched-
uled for May 2, 1977. The President will be elected for a five-year
term in the succeeding year by the People's Consultative bly,
which consists of Parliament and an equal number of appointed m-
bers. The People's Consultative Assembly will also at that time adopt
broad guidelines for governmental policy during the following fve
years.
Strongest opposition to the Suharto Government appears cen
among adherents of former Moslem parties who claim that the most
popular Moslem leaders have not been permitted to partici in lead-
ership of the Development Union Party and that neither their elec-
toral strength nor their views are properly reflected in the govern
ment. Criticism of the Suharto Government by these and other dis-
satisfied elements has centered on corruption. There seems to be, how-
ever, no basic disagreement with the Government's basic development
policy goals.
Indonesia, one of the world's poorest nations in terms of per capita
income, is richly endowed with a diversity of natural resources. It has
important desposits of oil, natural gas, nickel, copper and tin and is a
major producer of rubber, lumber and other agricultural products. Al-
though the United States is not as heavily dependent as most industrial
nations on these resources, circumstances could make them more impor-
tant in the future. The United States principal ally in Asia, J
relies heavily on Indonesian energy and raw materials. American firms
have invested approximately $2.5 billion in Indonesia, primarily in oil
and mining, and Indonesia welcomes further outside investment.
There are, however, severe restraints on the development of In-
donesia's minerals and, to a lesser extent, timber resources. These are
traditionally capital-intensive industries. For example, the Shell
Group recently entered into a production-sharing agreement with the
state-owned coal mining company to exploit extensive coal deposits in
Sumatra for which the development costs are expected to exceed $1.2
billion. Much of Indonesia's abundant mineral resources are located in
the most inaccessible, primative parts of Indonesia. Everywhere devel
opment of Indonesia's resources is characterized by large capital ex-
penditures. Even petroleum exploration and development co t, while
not reaching North Sea levels, are far in excess of other OPEC mem-
ber. While Indonesia has the potential resources which eventually
could make it very strong economically, it is still some distance fro
self-sustaining growth.
Oil dominates the Indonesian economy;nd following the doubling
of world oil prices in late 1973 and 1974, there was much optimism
about Indonesia's prospects. This opimim was dealt a severe bl
by problems encountered in 1975. In tht year there was decline in
demand for Indonesia's exports; a severe cashrisis in the state-owed
oil company, Pertamina; a drop in foreign investment; and continued
high levels of inflation.







Indonesia's oil revenues add only marginally to one of the world's
lowest per capita annual income rates and Indonesia, which accounts
for only about five percent of OPEC's oil production, has about half
of OPC's population. Ninety percent of Indonesia's oil is produced
by U.S. companies.
Pe mina is responsible under Indonesian law for managing all
petroleum activities in the country, including exploration, produc-
tion, refining and marketing. It owns and operates all of Indonesia's
refineries, domestic distribution facilities, and a fleet of tankers
and other vessels; it is also involved in a variety of non-petroleum
activities. Under the leadership of its former president, Lt. Gen-
eral Ibnu Sutowo, Pertamina became the leading edge of the gov-
ernment's development schemes. Pertamina's financial crisis surfaced


ped in and assumed responsibility for Pertamina's debts, which to-


IMF "warning level" of 20 percent of total value of exports in the
1979-80 period. As a fallout of the Pertamina crisis, President Suharto
announced in his budget message of January 196, that governent
revenues would be increased by 7.6 percent, and that this increase
would mainly be "acquired through reduction of profits gained by
oil companies on each barrel they produce." There then ensued a com-
plex series of negotiations with foreign oil companies, characterized
in many inst es by a confrontational atmosphere. Underthe new oil
contract terms, Indonesia achieved an 85-15 profit (formerly 65-35)
which should increase its revenues by $350 million, or expressed an-
other way, Indonesia's take increased an average of $1.88 per barrel of
oil, from $6.19 per barrel to $8.07.
In a sparate but related development, Indonesia recently has
spoken in a number of international meetings on economic problems
as seen by the Third World. Although its leaders continue to seek
large infusions of foreign capital, they have become more responsive
to domestic and foreign criticism that foreign investment amounts
to "selling out the country." Because of the importance of primary
products to Indonesia's economy, Indonesia is particularly concerned
about better terms of trade, higher value being added in producer
countries, producer control of transport and marketing, and other
portions of the platform of the new world economic order. Nonethe-
less, while identifying strongly with the Third World, Indonesia has
generally sought to play a moderating role in that group.
Indonesia has hadI one of the highest rates of inflation in the world
over the last five years. Although the rate has declined somewhat
over the past 12 months, it is currently running at approximately
20 percent per anmum, significantly higher than neighboring coun-
tries and trade competitors. As a consequence, the exchange rate of the
rupiah, which was set at 415 to the dollarin 1971, is under considera-
able pressure. Indonesia's net foreign reserves declined seriously dur-
ing 1975, reaching a low point of $442 million in the third quarter of
1975. Reserves have since staged a recovery, and as of mid-August 1976,
were reported at $1.1 billion.





10

Indonesia has over 135 million people living at the subsistence level
and a very poorly developed economic and social infrastructure. Its
trade balance has been persistently in deficit, even after oil prices rose
sharply in 1974. In the first Indonesi fiscal year after the oil ce
rise there was a trade deficit of $138 mllion which t 1
billion in the last fical year. The International Mon Fund pro-
jects a $1.8 billion deficit for the current fiscal year, wich will be
reduced somewhat by the increased take from oil profits.
Despite increased earnings from oil exports, Indonesia continues to
depen on large amounts of external aid. Economic assistance to In
nesia is coordinated through the Inter-Govermental Group on Indo-
nesia (IGGI), formed in 197 with the purpose of helping the uharto
Government obtain external financing for Indonesias development
program. The IGGI is composed of fourteen countries, the World
Bank, International Monetary Fund, and the Asian Development
Bank. Through FY 1974 the U.S. and Japan each pledged under th
umbrella of the IGGI to provide one-third of Indonesia's bilateral aid
requests. In FY 1975 the U.S. abandoned the one-third formula with
a significant reduction in its pledge. The World Bank has becoe the
largest donor agency to Indonesia with a commitent targt f FY
1977 of $550 million. Japan, providing about $140 million is yer,
is the largest bilateral donor.
There is no end in sight to Indonesia's need for external assistance,
according to the development assistance community. The U.S. has pro-
vided some $2.2 billion in assistance to Indonesia since independence.
It appears to me that the large volume of assistance, especially food
aid, has served as a crutch which has helped Indonesia avoid facing up
to its own internal problems, particularly those relating to food pro-
duction. By providing subsidized food to make up the sef-sufficiency
gap, the United States and other aid donors have enabled Indonesia to
avoid making hard choices in national priorities of development.
The contrast between Indonesia's vast numbers of poor and the few
rich is typified in Jakarta where a short distance off broad boulevards
lined by huge new office buildings and hotels, lie wretched slums. In the
seven years since my last visit to Indonesia there does not appear to
have been any progress toward narrowing the gap between the rich
and the poor. If anything, the disparity has been made more glaring,
at least in the capital, by a facade of modernity and progress.
There is no land shortage in Indonesia, only an overconcentration
of population. Two-thirds of its population live on two islands, Java
and Bali. Java, with 1,500 persons per square mile, is one of the most
densely populated areas in the world. However, there is no program at
present to encourage migration to the less developed ilands and the
population pressures on Java and Bali mount, Indonesia is still
dependent on imports to meet its needs for rice. Rice imports will total
about one million tons this year, with 350,000 tons to come from the
United States financed under the PL 480 program or on long-term
credits.
There is an effective population planning program. It is said that
five years ago the annual population growth rate was three percent;
has now been reduced to 2.3 percent and the goal is to reduce it to 1.8
percent by the end of 1979. There are strong social pressures to partici-
pate in the birth control program through local "Mother's Clubs."
With the advent of the Suharto Government in 1967, the United
States resumed military assistance. The first post-Sukarno era U.S.









ires to r bilitate rds, ports, and irrigation
systems. Military grant aid in FY 1967 amounted to -only $2.7 million.
In 1970 followg President Nixon's visit to Inonesia and support
t f e policy in Cambodia, U.S. military assistance mul-
Sin character. A 1971 interagency study set as a
plmillion in MAP grant aid or each of the next five
years, ac inued at approximately this level for several years
until it reduce following general cutbacks in military aid by

Today, Diplomatic Mission to Indonesia is stafed by a
Americans. The military mission of 70 has increased more
than five-fd since my last visit in 1969. The U.S. mission, in my
judgment, is overstafed and should be trimmed back substantially.
*In summary, Amrican relations with Indonesia are good but the
relationship is not as close as in the initial post-Sukarno years and it
is likely to become more distant in the days ahead.

IV. MALAYSIA
SMalaysia has a strong Western orientation, the gov-
ernent's cil policy has been to cultiate the Third World and
to take an active part in nonaligned affai. Since 1971, it has also
advocated creation of a zone of peace, freedom and neutrality in South-
east Asia and supported the proposal for an Indian Ocean peace zone.
Non-alignment and support for zones of peace and neutrality are in-
aysia, ifpossie, from the efects of great power
rivalry in the region and in the world at large. They are also intended
to iethe government some leverage on international economic

In 1960 the Malayan "emergency" was declared to be officially at an
end, although long bfore this Malaysian Communist Party (MCP)
Secretary Chin Peng had witihdrawn the remnants of his terrorist



cities and new Chinese settlements. The CP has had some success in
but icread govermet c ternsurgency eorts an

a split in the MCP itself have slowed this activity markedly. It is
estimated that there are some 3,000 active and armed terrorists in all.
At present, the terrorists are a nagging and expensive annoyance but
ty do nt pe a threat to te ernment or to the daily life of the

The U.S. has no major programs in Malaysia. The has never been
an ai program, a military assistance agreemenl t or bases. The Peace
Corps with approximately 60 volunteers is the largest U.S. program.
It is designed to supply experts to fill gaps in government programs

sians. In addition to the Peace Corps, the United States has a sma
military training program through which 40 to 60 Malaysian service
personnel are sent to the U.S. each yearfor training. There also i a

79-905 O 76 2





12

military credit program which amounted to $17 million in fiscal year
1976 and will total approximately $5 million in fiscal year 1977, financ-
ing items such as F-5E and F-5B aircraft, C-130 transports, helicop-
ters and armored cars.
Relations between Washington and Kuala Lumpur are cordial but
not intimate Prime Minister Datuk Hussein Onn has publicly ex-
pressed his desire to see a continued U.S. economic and lo
presence in Southeast Asia but his govermnt is also conscious of the
need to preserve its distance from all of the major powers. It main-
tains correct relations with both the Soviet Union and the People's
Republic of China and has offered technical assistance to Vietam.
It sent an ambassador to Hanoi in October. lthough Mlaysia is
concerned about Vietnam, it sees no alternative to bringing it into
association with the other nations of Southeast Asia.
The United States is one of Malaysia's most important customers
taking, for example, 40 percent of its most significant export, natur
rubber. Bilateral trade in 1975 involved exports to this country of
rubber, tin, palm oil and timber products amounting to $536 million.
Malaysia imported $394 million worth of U.S. machinery and tra1s-
portation equipment, manufactured goods, chemicals and other prod-
ucts during that same year. U.S. investment in Malaysia rose to an
estimated $450 million in 1975. The main component is petroleum ex-
ploration and exploitation but the investments also invole extensive
participation in the electronics industry.
All signs point to continued economic expansion. Financial reserves
are ample, the country is a preferred borrower. The security problem
is currently manageable. If peace and stability in the region continue,
Malaysia prospects are encouraging for the foreseeable future.
V. SINGAPORE
Singapore, a city state of some 3 million, has utilized its geographi-
cal location, its excellent harbor, and a skilled populace to reach a
level of development unparalleled in Southeast Asia. Singapore's
$2,500 per capita GNP is exceeded in Asia only by Japan. Its well-
being is dependent on the state of the world economy and on the
cooperation of its neighbors, Indonesia and Malaysia, which provide
the goods and markets for the Singapore entrepot and the raw mate-
rials for Singapore's factories.
Seventy-six percent of Singapore's population are descendents of the
Chinese migrants who for centuries have moved to Southeast Asia in
search of greater opportunity. Both Malaysia and Indonesia also have
Chinese minorities (36 percent in Malaysia, about three percent in
Indonesia) which dominate their commerce and are visibly wealthier
than the ethnic majorities. In both countries there is a heritage of mis-
trust and tension between the Malay/Indonesian and the ethnic Chin-
ese communities, reflected in varying degrees in the attitudes of their
governments toward Singapore.
Although Premier Lee Kuan Yew, who has been in power for seven-
teen years, visited Peking last May, Singapore has not yet established
formal diplomatic relations with China, stating that it will not do so
until after Indonesia has acted. Singapore is an active member of
ASEAN and has pressed for the elimination of trade barriers and
greater economic cooperation, to the discomfort, in particular, of less
economically developed Indonesia. Internationally, Singapore is osten-





13

sibly non-aligned. Its commitment to free enterprise and its reliance on
the word m et, however, hae given its policies a generally pro-
Western bias. In its security relationships, for example, Singapore
as until rntly look primarily to the Five-Power Defense Ar-
rangment (FPDA) that links it-along with Malaysia-to Britain,
Austlia ad New Zealand. Last March, Britain completed with-
drawal froits naval base in Singapore. However, a small New Zea-
land Army unit is still based there.
Singapore's vulnerability, especially to outside economic pressures,
r s te gt to exercise special care in not antagonizing
other cunt unnecessarily. For example, the dependence of the huge
Singapore oil refining complex, third largest in the world, on Middle
East crude is a prime element in shaping Singapore's cautiously neu-
tral position toward Arab-Israeli issues. Prime Minister Lee has been
outsp n about te importance of maintaining a great power balance
in the region. Hebelieves that the Soviets will not voluntarily limit
their p ence in the area and that, thereorhe ere should be no pres-
sure on the United States to leave the region. Indeed, Lee has implied
at it is necessary to encourage the United States to maintain a suit-
able pr e both in Southeast Asia, as well 'as in the Indian Ocean.
he tti tde of Lee and his governme toward the presence of the
Sp i ast Asia stems in part from Singapore's posi-
tion asn ethnic Chinese city-state. Aware of the potential pull of the
SLee has b reluctant to follow the Malaysians,
ais and Filipinos in establishing relations with Peking. On the other
nd becaue Sngaore is situated in an area dominated ethnically
by alys, Lee preerthe region to be open to the peaceful competi-
t o te t powers provided no single power is dominant.

United States for support in the security field. He is especially con-
cerned over the implications of the insur cy in Malaysia. Modern
in the United States o commercial terms.
Singapore recently contrcted to purchase a adron of F-5E's with
air-to-air missiles. Singapore's decision to acquire a substantial portion
of its military equipment and service requirements from the United
S is t with the overall cordial lateral relationship. Sing-
apore is not only a major trading and investment partner of the United
States, it also grants this Nation access to its naval and air facilities.
Soviet ships also bunker and repl h at Singapore's docks. Chinese
Because of the "openness" of the my, Singapore is extremely
vulnerable to foreign trade fluctuations. The manufacturing and for-
igi iby the world r sion
trade. But barring unforeseen cir-
cumstances, there should be a six to eight percent increase in economic
growth in 1976. Inflation has not been a problem recently, amounting


ticipation or in the employment of expatriate management staffs. Fi-
nancial inducements, usually in the form of tax forgiveness, are avail-
able to those companies engaged in lines of production involving high
a o s Ix





14

ticements and to the advantages offered by Singapore's location and
its efficient administration, American private investment stands at
nearly $1 billion. It constitutes the island's single lar
vate foreign investment. It is estimated that one-fourth to one-third
of the Americans in Singapore are there in connection with oil drilling
operations in the area but, because of a falloff in activity, their popula-
tion may be reduced by one-half in coming years. Twenty drilling rigs
are now in mothballs.
Singapore is eligible for preferences under U.S. tariff laws and in
response to a request of the Singapore government, the product eligi-
bility rules were broadened recently to take Singapores entrepot econ-
omy into account.
VI. PAPUA NEW GUINEA

Newly independent Papua New Guinea is an important bridge be-
tween Southeast Asia and the Southwest Pacific, with 85 percent of its
land area made up of the eastern half of the massive island of New
Guinea. Irian Jaya, the western half, is a province of Indonesia.
American missionaries have been in New Guinea for decades and
more than 2,500 are there today. Over a million American servicemen
went through Papua New Guinea during the Second World War and
they are remembered with fondness. General Douglas MacArthur is
recalled with special respect.
While the United States does not have any vital interests in Papua
New Guinea, the nation plays a role in U.S. objectives for the Pacific.
U.S. strategic interests in the area are supported by the maintenance
of harmonious and cooperative relationships between Papua New
Guinea and Australia and Indonesia; the denial of bases and other local
facilities to potential enemies; and the continuation of the country's
political unity and stability.
The U.S. Mission is small, highly regarded and effective. Papua
New Guinea's leadership is well disposed toward the United States,
and has pursued moderate internal and foreign policies. There is no
U.S. aid procrram, not even a Peace Corps presence and in my judg-
ment it should remain this way.
Papua New Guinea became a sovereign nation on September 16,
1975. Its leaders have since demonstrated a capacity to lead the country
effectively even when confronted with a number of difficult problems
including a secessionist movement on the copper-rich island of
Bougainville. Several important economic developments have occurred
during the past year. For Papua New Guinea, the most crucial was
an aid commitment by the Government of Australia for $1.2 billion
over the next five years. The Government of Papua New Guinea has
encouraged direct foreign investments under increasingly hospitable
terms. Moreover, during the period of economic stagnation and decline
in revenues from basic commodities, not once did the Government at-
tempt to align itself with the more extreme positions of the Third
World to curtail supplies or attempt to manipulate the market by
artificially created higher prices.
Papua New Guinea is one of the world's least tapped sources of
natural resources. Copper, gold, silver and zinc are some of the min-
erals known to exist in commercially profitable quantities. Gas has
been found, and oil is thought to be there. A wide variety of troical





15

roduce can be grown. Access to tuna fishing grounds and timber
resources are eagerly sought after by foreign companies. The ratio
of o its lation is very favorable. With fewer than three
million people and a population density of seven persons per square
mile,Papua New Guinea is much more favorably endowed than most
S tries Enomic aid from Australia has provided the
basis for the beginnings of the infrastructure without significant

The present government has had almost five years' experience in
runing the country the country's political institutions are operative;
the army hastayed o lut of politics and is loyal to the government;
the country is at peace with its neighbors; its international problems
are ; here is a strong egalitarian tradition among the people;
and there are n ideological hangups.
On the other hand, Papua New Guinea suffers from difficult divisions
of geogrphy d language and from wide variations in degree of
deopment. The rapid pace of modernization is leaving large sec-
tions far behind, with sophisticated political and economic systems
imp on a primitive tribal society. Only 15 percent of the people
are literate. The leadership of the country is painfully small in num-
ber, and the supply of ained manpower is quite inadequate. The
peple have high expectations. Tremendous opportunities which are
avai be to trained young people are leading them to focus more on
their own careers than on the country's future. An elite has been
created which could easily become divided from the people.
The ovenment is beginning to display greater receptivity to for-
elgn private investment. Several large projects are now pending and,
if approved, they will eventually provide tax revenue, export earnings,
and jobs. The lead time for most of them is six to ten years, but they
will require construction workers to build roads, bridges and houses
before becoming operational. The projects now under construction
in ude a TU.. teel sponsored gold mine ($200 million), three copper
i ih will be developed by internatinal consortia, and a fish
canning project. In addition, natural gas exploration is being con-
ducted by a Japanese consortium and oil drilling is taking place in
three localities under the aegis of a U.S./Australian/British consor-
tiu. Further down the road is an enormous hydro-electric project
which will r re llions of dollars to develop but which is expected
to create large amounts of relatively cheap electricity.
Papua ew Guinea is an inward-looking country absorbed in its
own affairs. It is at peace with is neighbos ad has no pressing prob-
lems of foreign policy. Its basic policy has been described as one of
ha g ien no emies" The goverment does not want
to be involved in great power struggles and does not want aid from
te nited State, th Soviets or the Chinese. "We are neutral to
everybody;" a national leader said to me, "if you come as friends, we
are not interested in ideology." The nations most relevant to Papua
S uiea's future are Australia, Indonesia and Japan. Australia
is important because of the long and close associatio, a very large aid
program and the significant role of Australian business in the econ-
omy. Indonesia is important because it shares the boundary which
divides Papua New Guinea from the Melanesians of Irian Jaya. Japan
82A^'





16

nation's economic relations. Papua New Guia as as s i
with the other small Pacific island countrie. E and emoti
considerations enter into these ties but in economic terms, it is be
ing increasingly evident that the Philippines and Indonesia will be of
far greater significance than the coral atolls of the Pacific.
Papua New Guinea is pursuing a foreign policy of fosteringa cor-
rect friendship with larger countries and avoiding the in of
enemies. It is likely to stay somewhat apart from the Afro-Asian bloc
countries, and to abstain from involvement in issues not directly af-
fecting the South Pacific. It has diplomatic relations with both the
Soviet Union and China, but there is concern over the posibility of a
Soviet presnce in Tonga and the Chinese presence in Western Samoa.
With its great and developed natural resources and its proximity to
resource-poor Japan, it is also concerned with that nation's economic
dominance in the region. There is interest in having the United States
and other nations increase their economic involvement as a balancing
factor, "Investment possibilities are here," a leader said to me: "Men-
tion anything, we have it here." Papua New Guinea is, in truth, a
storehouse of vast potential in a world of dwindling resources as well
as a bridge between Southeast Asia and Southwest Pacific. It wants
outside capital for resource development, but only on its terms.
While it is a new nation with many problems, Papua New Guinea
is taking the long view in its relations with the world. "We are
friends," Sir Maori Kiki, the Acting Prime Minister said to me. I
hope that the relationship between our countries will remain cordial.
There are no outstanding contentious issues between us and there exists
a wide basis of understanding.

VII. Co~CLUDINM COMMENTS
Since this report completes the general survey of U.S. policy in
Asia and the Pacific which I began last July, I will conclude with a
number of comments about certain specific matters which relate to
that policy.
American policy in Asia is now grounded on the fact that the
United States is not an Asian power but a Pacific power. The differ-
ence is more than semantic. It is the difference between a sensible ac-
ceptance of the realities of Asia and dangerous illusions of military
omnipotence. What takes place in the vast region of Asia, of course, is
of concern to Americans. But concern and control are quite different
matters. Simply stated, America's principal long-range interests in the
Pacific are to discourage domination of the region by any single power,
to maintain friendly relations with China, Japan and other nations
and to lessen tensions which could trigger either a local or a at
power conflict in the area.
In my estimation the United States position in Asia and the Pacific
is more favorable than it has been since the end of World War II:
There is no war.
We enjoy good relations with all nations except North Korea
and the countries of Indochina, which the Executive Branch has
chosen to ignore.
After the tragedy of Indochina, both we and the nations of the
region have a better understanding of what it takes to live in
peace in a diverse world.





17

There are no American troops in Southeast Asia or anywhere
else on the Asian mainland except in South Korea where 40,000

Te econoic burden of U.S. political involvement in the area
has lessened.
The foremost problem for American policy regarding Asia is to
complete the normalization of relations with the People's Republic of
China.
The part p between the United States and Japan remains as a
fundamental pillar of American policy in Asia. It must be a partner-
ship of equality; the post-war era of patron-client is over. Japan's
continued trust in the validity of the United States security commit-
ment is essen tlo the maintenance of stability throughout the region.
This country ought not to provide the grounds for Japanese to
doubt the U.S. security guarantee or to make a significant change
in their domestic policy. A Japan embarked on major military ex-
pansion would unsettle all of Asia. U.S.-Japan relations are good but
they could be better and it behooves us to avoid the further shocks of
sudden policy shifts without notice.
Korea is a time bomb which must be defused. The United States'
objective should be to try to bring about a settlement between the two
Koreas and, in the interim, to ease tensions and lessen the possibility
for a resumption of hostilities. U.S. policy should not be hostage to any
particular government in Korea, or anywhere else for that matter.
Our forces in this last U.S. bastion on the Asian Mainland should be
reduced over a period of time, after consultation with Japan, and all
nuclear weapons should be removed from the peninsula.
In S east Asia, the foremost task for U.S. policy remains to
adjust to the realities in Indochina. The current policy of opposition
to trade and diplomatic relations with Vietnam and Cambodia and to
Vietnam's application for membership in the United Nations, as well
as the failure to send an Ambassador to Laos has something in it of
the ostrich complex. The fact is that just as China was not ours to lose
in 149, neither was Indochina a quarter of a century later. It is time
that the United States act toward the governments of Indochina in
a spirit which seeks to heal the wounds of war and therefore, enhances
he prospect for a final accounting of the missing in action. Vietnam
is a major force in Southeast Asia and it is in this nation's long-
rang interest to accommodate to that fact.
The remnants of a long-time U.S military involvement, a smoulder-
ing insurgency in the Northeast, a genuine fear of North Vietnam's
intentions, and the continued existence of the SEATO treaty com-
mitment to Thailand, all add up to a sensitie and volatile situation
for the United States in Thailand. There should be no resumption of
the vast array of U.S. activities once carried out in Thailand, and
the SEATO commitment suld be terminated.
The era of U.S. military adventure on the Asian Mainland is over.
We a atic view of what. as a ractical matter. can
and cannot be done on that continent. We know that it is not possible,
or en desirable, to remake ancient cultures in our own image. There
is a sober realization of the limits of America's resources and power.
As was true of America in the ast, the America of the future will
be the beacon to the world, not because of military might or foreign





18

aid but beause of what it stands for in furthering asprations for
fredom and human decency. .
There is an agenda of unfinished business in Asia and the Pacific,
to be sure. But the problems are manageable. What is needed is the will
to clear away the last relics of out-dated policies, to learn from the
past, and to face up to the present and the future.





APPENDIX 1

94th Cogss COXXITT PraT
2d Seinsion j






THE END OF THE POSTWAR ERA


TIME FOR A NEW PARTNERSHIP
OF EQUALITY WITH JAPAN


A REPORT

BY

Senator MIKE MANSFIELD
Majority L ade .United .States Senate
TO TH

COMMITTEE ON FOREIGN RELATIONS
UNITED STATES SENATE


REPORT NUMBER ONE












Printed for the use of the Committee on Foreign Relations

U.S. GOVERNMENT PRINTING OFFICE
I ysG oC
WASHINGTON : 1976


(19)






20
























COMMITTEE ON FOREIGN RELATIONS
JOHN SPARKMAN, Alabama, Chairman
MIKE MANSFIELD, Montana CLIFFORD P. CASE, New Jersey
FRANK 'CHURCf, Idaho JACOB K. JAVITS, New York
STUART SYMINGTON, Missouri HUGH SCOTT, Pennsylvania
CLAIBORNE PELL, Rhode Island JAMES B. PEARSON, Kansas
GALE W. McGEE, Wyoming CHARLES H. PERCY, Illinois
GEORGE S. McGOVERN, South Dakota ROBERT 'P. GRIFFIN, Michigan
HUBERT H. HUMPHREY, Minnesota
DICK CLARK, Iowa
JOSEPH R, BIDEN, JR.,: Delaware
PAT M. HOLT, Chief of Staff
ARTHUR M. KUHL, Chief Clerk
(II)






21







CONTENTS



Letter of transmittal-.........-- ------------------... --..
Text of report ------------------------ --,---
I. Importance of the United States-Japan relationship....... 1
II. Foreign policy and security matters........------........... 2
(a) U.S. bases and personnel ..... .... ... 8
S1. Okinawa ----------------------- ------ 9
'.III. Es -e 10-
IV. onluding bservations-------............... 11
V. Recommendations .......--------...-----......-----...... 1
Appendix -- ----------------------- ----------------- is
1. Tet of the United States-Japan Mutual Security Treaty- 15
2. Tet of the tatus of Forces Agreement With Japan .--- 21
SText of Japan's Defense "White Paper"-. .. ----- _- 41
4. Data concerning U.S. military personnel and bases in Japan-- ....
E~I: "~ -*. -*** --- *- (ffny *. '






























| M.'* f*** "






!||g~ _;li, ~ 1; ii:" ~ ;,;:
yr"111
































k











8il
~H,


8,

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I


rl g





LETTER OF TRANMITTAL

AGUST 2, 1976.
Hon. JoHN SPABKMAN,
Chairman, Committee on Foreign Relatios,
U7.. &eate, Washington, D.C.
D M. CHARMAN: As you know, with the Committee's permis-
sion, during the July recess I made an oficial trip to Japan to study
major United State forei an security problems in the Far East
with emphasis on United ates relations with Japan and Japanese
attitudes concerning a number of matters of mutual interest, such as
issues involving the People's Republic of China, the Soviet Union,
and Korea. I am hereby transmitting my report on that trip. A con-
fidential report has been sent to the President.
I was in Japan from July 9 through July 16, when I returned to
Washington. While there I received a thorough briefing from Ambas-
sador James D. Hodgson and his staff concerning political, economic,
and security matters. I also had an informative briefing from Lt. Gen-
eral Walter T. Galligan, USAF, Commander, U.S. Forces Japan, and
his staff concerning the status of U.S. military bases and personnel in
Japan. Both Ambassador Hodgson and General Galligan were most
helpful and cooperative.
I met with a number of officials of the Japanese government, each
of whom was most generous with his time. Among those with whom
I held discussions were Prime Minister Takeo Miki; Deputy Prime
Minister and Director General of Economic Planning, Takeo Fukuda ;
Foreign Minister Kiihi Miyazawa; Director General of the Japan
Defense Agency, Michata Sakata; and Finance Minister Masayoshi
Ohira. My conversations with each official covered a wide range of
subjects and thus gave me a broad cross section of opinion within the
Japanese government on many matters of common interest.
In addition to these meetings, I had an opportunity for informal
discussions with Deputy Minister of Foreign Affairs Keisuke Arita
and several of his colleagues, former Japanese Ambassadors the
United States Takeshi Yasukawa and Nobuhiko Ushiba, and others.
I was accompanied on the trip by Mr. Francis R. Valeo, Secretary
of the Senate, and Mr. Norvill Jones of the Committee staff. In order
to obtain further information concerning the Korean problems and
the Taiwan issues, as they relate to Japan, I sent Mr. Valeo to Korea
and Mr. Jones to Taiwan following the completion of my schedule in
Japan. At my request, Mr. Jones also inspected the U.S. military base
situation in Okinawa on his way back to Washington.
I wish to express my appreciation to the Department of State for
making my travel arrangements; to Ambassador Hodgson and his
staff for their assistance and many courtesies; to General Galligan
and his staff for the briefing and other helpful information; to the
Congressional Research Service of the ibrary of Congress for as-
sembling background materials; to the Department of Defense for
assistance in field toMr. Valeo and Mr. Jones; to Mr. Valeo, who,
as a former consultant to the Committee on Foreign Relations, has
accompanied me on many past missions abroad, and to Mr. Jones of
the Committee staff, who has also accompanied me on a number of past
missions, for their assistance in connection with the trip.
Sincerely yours,
(V)
I "" ".'
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THE ENDi OF THE POSTWAR ERA-TIME FOR A NEW
PARIP OF EQUALITY WITH JAPAN


IMPORTANCE OF THE UNITED STATES-JAPAN RELATIONSHIP
Oe d and twent-three years ago Commodore atthew
Perry lfour U.S. nav s ito Tokyo Bay, opening Japan to
the ose world after more than two centuries of isolation. A new
rfor our two countries, a relationship which, over
e yes, has moved through a broad spectrum, from friendship to
to again. It s commonplace to say that there
is cial relationship between our two countries. But this is an in-
rm to be th interdependence and mutuality of inter-
st that Ioind our countries together. A stable Japan,
i iitry theto the natio of Asia, is essential to
stabilityand in thePaci and the world. Although it lacks
military power, Japan is the world's third ranking economic power
tes ong the industrial democraes.
it is a factor to be reckoned with in its capacity to in-
fluence the flow ofinternational events.,
side from the umbrell of security provided by the mutual security
treaty,the United States relationship is essential to Jaan as a source
of food, raw materials, and as -a market for Japan's industrial output.
To. the United States, far less dependent on world markets for eco-
noe beg, the Japanese tie is essential in a different, but no less
iIt is a fundamental pillar in present U.S. foreign
poliyhose.go is continued stability in the Western Pacific. Geog-
aphy and -histor, combined with the genius and industry of the
Japanese peomade Japan a keystone of that policy. The
waters of the Pacific lap the shores of all the world's major powers-
| (1 wod s major powers-
the United States, the Soviet Union, China, and Japan-and it is in
te environs of the latter country thattheinterestsof all are most
entwined. For this nation which has foght three wars in Asia within
eratio, the role of Japan in the structure of peace in the Pacific
will ontinue to be of utmost importance in the years ahead. It is
of b peoples to work at strengthening this unique

The visit by Commodore Perrbegan what became the first of a
eries f ups and downsin relations between Japan and the United
States. Unlike our ties with Great Britain, language and cultural dif-
ferences have been obstacles to mutual understanding between Japa-
ese and Americans. Trust does not come easy under these circum-
stances. Extraordinary efforts byesare necessary. As Pro-
cently, this difficulty is compounded by the fact that: "We, for





26


2

our part have lingerin traces of the unquestioned nineteenth century
assumtion that the West was in all ways superior to the rest o the
world "
Since the post-World War II occupation began, Americans have
had a tendency to take the Japanese tie for granted. The Nixon
"shocks" arising out of a failure to consult on measures to support
the dollar, to suspend soybean exports, and on the new China policy
have not been forgotten. There should be no more such unnecessary
and undiplomatic treatment of our closest major ally in the Pacific.

.. FOREIGN POLOCT AND SECURITY
Japan is an island nation. That, and an astute foreign policy have
relieved its people of an discernible fear of attack from abroad. It
enjoys good relations with all of the major powers and diplomatic and
commercial.relations with practically every nation of the world. A
security commitment from the United States permits the spending of
less than one percent of its gross national product for defense pur-
poses. Japan's foreign policy, which is built around the umbrella of
the security pact with the United States, has paid rich dividends by
freeing resources for economic growth that would otherwise be de-
voted to unproductive military spending. '
Article IX of the Japanese Constitution is the foundation of Ja-
pan's external policies. It states:
Aspiring sincerely to an international peace based on justice and order,
the Japanese people forever renounce war as a sovereign right of the nation and
the threat or use of force as means of settling international disputes.
In order to accomplish the aim of the preceding paragraph, land, sea and air
forces, as well as other war potential, will never be maintained. The right of bel-
ligerency of the state will not be recognized.
Within these constraints, Japan has, like a Phoenix, risen from the
ashes of defeat and humiliation into a unique position on the interna-
tional scene. There is widespread public sensitivity among the Japa-
nese .to all iailitary issues, particularly to those involving nuclear
weapons. Japan's status as an unarmed, economic giant in a world
bristling withv eapons of mass destruction has contributed geatly.to
the easing of bitter memories of Japanese militarism, to the opening
of doots to Japanese economic dynamism, and to a more stable inter-
national environment, notably in Northeast Asia.
Japan mantinins only a small Self-Defense Force consisting :f some
240,000 men. Recruitment for even this small force is difficult. At bot-
tom, Japan's real security, aside from the U.S. comnmitrent, is en-
trusted to effective foreign policies.
Following in the path of the Nixon visit to Peking, Japan estab-
lished diplomatic relations with the People's Republic of. Chinaon
September 29,1972, but a Sino-Japanes e peacetrty to end the formal
state of hostilities from World War II has not yet been concluded. It
is stalled by a dispute over Chinese insistence on an "anti-hemony"
clause. Although agreeable in principle to such a clause, the Japanese
confront the fact tat the Soviet Union has indicated that such lan-
guage in a treaty would be considered an unfriendly act. Negotiations
with China have been at a stalemate since last year. Meanwhile, trade
and other relations with China continue, with $2.5 billion in exports
to China and $1.5 billion in imports from China in 1975, three times
the level of trade in 1970.






27


3

Under the "Japanese formula," Japan also maintains economic and
cultural relations with Taiwan The nation's interests on Taiwan
are represented by the unofficial organization designated the "Japanese
Interchange Association," which is headed by a former Japanese am-
assador. The association is financed primarily by private funds.
Taiwan's interests in Japan are represented by the Far East Asocia-
tion. The personnel of neither organization have any form of diplo-
matic status or immunity.
Other countries which recognize the People's Republic of China
loo after their trade or cultural interests in Taiwan through varying
types of organizations: Great Britain through the Anglo-Taiwan
Trade Committee; Germany through the Goehe Institution; Spain
through the Cervantes Center; and the Philippines through the Asian
Exchange Center. Taiwan has developed a web of relationships in
order to handle specific circumstances which may be involved with
any individual country.
The "Japanese formula" has worked well for Japan. Since formal
diplomatic recognition of the People's Republic of China, trade, in-
vestment, and travel between Taiwan and Japan have all expanded.
Trade has more than doubled-to $2.5 billion last year-and accounts
for 22 percent of all Taiwan's trade (the U.S. accounted for 31 percent
of Taiwan's trade in 1975-$3.47 billion).
With regard to the Soviet Union, Japan has yet to conclude a World
War II peace treaty, the matter being snagged over four islands north
of Hokkaido claimed by both Japan and the Soviet Union.1 No break
in the impasse is in sigt. There is in Sapporo, the principal city of
Hokkaido, a "Movement for the Reversion of the Habomais." The
agitation which this group fosters from time to time is tempered by
the realization that the Soviet Union is in a position to curtail fishing
rights which are of significance. to the Japanese. Moreover, there is
a substantial general trade with the Soviet Union, although it is some-
what less than commerce with China. Last year exports to the U.S.S.R.
were $1.62 billion and imports $1.17 billion. With regard to the status
of Japanese joint ventures with the Soviets in the development of
Siberia, many projects have been discussed but only two, natural gas
and timber, have made progress. Others seem to be "fading away," as
one Japanese official put it, due in part apparently, to the reluctance
of U.S. private interests, which were also involved, to pursue them
at this time.
Japanese officials are concerned about the increase in Soviet naval
activities in the Western Pacific, citing in particular an increase in
the activities of intelligence vessels. hile I was in Japan, Soviet
ships and ASW aircraft were conducting maneuvers in the Okinawa
area. Insofar as Japan is concerned, the increase in Soviet naval opera-
tions in the Western Pacific is viewed, one involved official said, as
constituting "a potential threat to Japan-but it is not overt yet." He
went on to say that the Soviets were also engaged in a "cultural
offensive."
SDevelopments in the situation on the Korean Peninsula are reflected
in Japan, in part, through the large Korean community. in Japan,
which is divided in its sentiments about the problems of the Peninsula.
1 The Islands in dispute are Etoroft, Xufashiri, Shikotan, and Habomal.
79-905 0 76 3








4

Some favor the North ad others support ea and Japan is
frequently drawn into difficulties arising from this division. There is
also a deep-seated historic concern in Japan with the impact devel-
opments in Korea on Japanese security.
The traditional overland invasion route to Japan has been via the
"Lv.oncute to y'
Peninsula. While this route has also operated in the other direction,
the fact is that in present circumtaces both Soviet and Chinese mili-
tary power which mit approach by way of Korea appear over-
whelming to Japan. ose Japanese given to nightmares this
matter, moreover, note that if the Koreans of the North and South
should ever get together, their combined armed strengths would be
four or five times greater than Japan's lightly armed self-defense
force.
It is clear that a military conflict between orth and South Korea
could pose a thret to Japan especially if it were to draw in great
powers as would be almost inevitable. Indeed, a breakdown of order
in South Korea alone would create serious difficulties for the Japanese
who have developed a major trading relationship of about $4 billion
annually with Seoul2 and, in addition, have large investments in
Korea.3
There is little that is apparent in the current Korean situation- t
feed these Japanese anxieties The Republic of Korea, functions under
a government which is for all practical purposes, a military-bureau-
cratic authoritarianism under the control of President Park Chung-
Hee. Two years ago there was still protest and agitation for political
freedom on the part of intellectuals, religiou groups and oers but
that has now ceased. Civil liberties are in abeyance and fear of prison
or death has silenced the opposition. The Park Administration is said
to have considerable popular support. Certainly, it has the backing of
the military establishment and the acquiesence if not the active up-
port of major industrial and commercial groups. It has, of course
official support from the United States and, probably, from other
foreign sources. The government, in short, gives the appearance of
stability.
Moreover, the South Korean economy has been cnverted-into a
modern establishment which is second only to Japan amon Asian
nations. Its peoples are industrious and dexterous and, in thespac
of two decades, have developed a great range of modern industrial
skills. Recent concentration on the improvement of agriculture has
resulted in a rapid growth in the output of food to a point that is now
close to adequate for m taining the population.
Presently, the nation is in the midst of a boom, with industrial pro-
duction expanding at the rate of 20 percent a year. The growth in
GNP is running between 6 percent and 8 percent which, in the face of
a drastically declining birth rate, is said to be bringing a great im-
provement in general living standards.
The Korean economic transition has depended heavily on U.S. eco-
nomic aid, a program which is drawing to a close. The veties
calculated at about $40 million in the pipeline and, approximately $300
2Japan also has very limited trading cotacts with North Korea, whichor the pres-
ent have been suspended due to the inability of Pyongyang to make payment for past
purchase.
SOne readily recognizable yardstick of this nvestment; all blacknd white /Vs
which are distributed by Japan are now made in South Korea.





29


5

l in ruural pructs, der a PL 480 agreement. An in-
t t. arantee program cont ues to operate and is a significnt
factor in the inflow of private capital.
Korean trade is still closely tied to the United States and Japan,
wit the latter, in particular, providing a funnel for the outflow of
Korean manufactures. However, the Koreans are beginning to devel-
opt commercial contacts with the rest of the world and Ko-
rean firms are said to have written in the neighborhood of $2 billion
of contracts to undertake construction in the Middle Eastern oil coun-
tries. Sel is attracting an increasing inflow of businessmen from
that reion and from all other parts of the world, except Latin

The Korean capital city which now contains about 7 million persons
is the center of industrial and commercial activity. It is a dynamic
modern city in the midst of a building boom. It should be noted that
the building includes deep concrete tunnels everywhere which are de-
signed to relieve heavy surface trafic but which could serve as shelters
in the event of war.
It is not ssible to find in the present situation a persuasive reason
to beliee that war is imminent. Along the 380 parallel, except for
1occa a localized personnel clashes and a two-way loud-speaker
pnda war, all is quiet. The International Commission (Czecho-
slovakia, Poland, Switzerland and Sweden), as it has been for more
han two decades, is present in the Zone. North Koreans and U.S. and
South Korean military personnel continue tom tain rigidly formal
cota, with occasional quarrels the conferee table that stand
s 80 paralle. While the southern approaches to the demili-
tarized zone run through a kind of no-man's land, it is said that 40,000
tourists and other visitors a year pass through them to the 38 parallel.
North Korea also its flow of tourist buses carryng Koreans and
her viitos from Cmmunist countries to observe the dividing line.
The Soviet Union and the People's Republic of China are believed
to have exerisd a restraining. influence on Pyongyang in order to
prevent a precipitous rekindling of the war. However, Kim II-sung,
he N hern rule, aserts tat there is no intention to seek unifica-
tin of te c y by military. means. The two sides continue to meet
periodically at a verylow level of Red Cross contact to seek unifia-
tin b other means but.pr to date has been completely absent.
In the Souththe government stresses continuously the danger of
invasionfromtheNorthand concentrates on the improvement of its
militaryforces.Themodnization program, except in regard to the
Navy, is well-advanced.. The U.S. aid-subsidy of -the Korean military
establis ent is now largely provided under the military purchase
ra. Te K as ae -ag an increasingly larger share of

Notwithstanding these developments, the presence of U.S. combat

sion from the North. There is deployed in the South, a contingent of
about.40,000 U.S. serviceme. Except for small economy-induced re-
ductions, the number has not been loredinmany years. Even those
int( e-ea










gestion of rapidwithdrawal, hoiwever, is a source of profound axiety
to South Korean officials, even more perhaps than to the Japanese.
Some estimates are that the p
have no more than a 0 chance of survival t the.S. milry
presence. However, the Administration has made clear that the United
States has no tention of withdrawing precipit liill
the Conas not taken any measures which would compel a pre-
cipitous withdrawaIn short, the situation insofar the
are concerned is one of stability.
It is a stability, however, which is underlai with uncertainties. In
the first place, the economic progress which is probably a m o
public acquiescence in the present government rests on an ly
fragile base. It is dependent almost entirely on the import of raw ma-
terials and the export of industrial surpluses whic are prod
competitively largely by the comparative advantage of a low wage
cale and investment guarantees. Any tremors in either the economy of
Japan or the United States tend to become earthquakes in South
Korea.
In the second place although the present government is fully aware
of the aversion which exists in segments of Congressi and
other opinion in the United States regarding its authoritarianism, it
appears to have no intention of modifying the present political
'ture. Its view is that this structure is not only necessary for defense
against the North bt is essential to the kind of economic pro
which is being fostered in the South.
Finally, there is the question of U.S. military withdrawal. The
question is often asked: how long will th comitent last? Clearly, a
precipitous pullout by the United States, even if it did not open
door to military attack from the North would shake te government of
,South Korea to its very foundations. The reactions of an embittered
political opposition and from within the military establishment are
not measurable. Moreover, it is entirely possible that the deep-eated
sentiments for Korean unification would surface in both North and
-South. The potential for spreading instability would be very great
Notwithstanding outward appearances, then the basis for the Japa
nese concern regarding the Korean Peninsula is very real. In short,
Korea is a time-bomb which has yetto be defused.
Looking at Asia in general, the is a strong mutuality of interests
shared by Japan and the United States. Japan is a firm supporteof
ASEAN, the Association of Southeast Asia Nations, as a new force
fbr economic cooperation and progress in Southeast Asia Japan is
also inerested in working toward broadening the regional concept of
"ASEAN to bring the ations of Indochina into the current mem
ship: the Philippines, Thailand, Malaysia, Singapore, and ndn
Regional cooperation for peaceful purposes is a concept which ap
to have broad support in Japan and, if pursued, should contribute to
;Asian stability and progress. "Poverty and peace," on Japanese o
ficial put it, "cannot co-exist."
As to national security matters, in *June the Japa e Def
Agency issued a Defense White Paper the second end of
World'War II. The basic objectives of the paper were to
discussion of Japan's defense posture and to strengthen support
for the Government' program to upgrade the quality of these forces.





131




(the text of the paper is printed in the Appendix) The report is prem-
ised on a continuation of the international status quo between the
d Stat, the Soviet Union, and China and no change in Japan's
ultimate dependence on the U.S. security guarantee.
cally, the rep takes an optimistic view of the international
situation for Japan and assumes that any U.S.-U.S.S.R. conflict will
not spill over to affect Japan. It rejects a nuclear option, stating that:
If Jpan should take a nuclear option, even for a purely defensive purpose,
her actual ssssion of nuclear arms will reate serious suspicion and fear on

The intenat ional environment on which Japan's defense policy
will be based is described as assuming:
(a) that the U.S. and the Soviet Union will try to avoid an inter-continental
nulear war ad an armed conlict which might lead to their full-scale involve-
(b) that the SovietUnion will continue to face many European problems-
a TOWarsaw Pact confrontation and the control of East European nations,
among other matters.
(c) that So viet relations, improved partially, will most unlikely lead
to an end of confrontation.
() that in Sino-U. relations, a further .adjustment will continue on a
reciprocal basis, and
(e) that the status quo,- ore or less, will be maintained in the Korean
Peninsula where a minor incident would not escalate to a large-scale conflict.
Japan's view of the U.S.-Japan security relationship is described
this way:
(a) The system is generally understood to play the role of preventing aggres-
on against Japan from actually taking place, and of limiting the scale of an
(b) The system is also instrumental in providing the. U.S. forces with facilities
and areas for ther use which in trn make their presence tenable.
An integral of the basic framework of international relations in Asia, the
systemths contributes to the stability of the world and the maintenance of
peace. Finally, but not the least importantly, it is the indispensable base of
the wider spectrum of friendly U.S.-Japanese relations.
Clerlyreliance on the U.S. commitment remains strong on the
part of the Japanese government, and close observers say that there is
less controversy now over the U.S. security treaty than at any time
sin th relationship was formalized twenty-four years ago. There is
now a more rational, less emotional, public dialogue over security
i s tn in he past. I found no indication that the fall of Indochina
ad resulted in any lesened confidence in the U.S. commitment, al-
h there ws some initial nervousness.
The White Paper emphasizes that Japan's defense objective is "on
qualitative improement rather than on quantitative expansion in the
planned buildup of our defense capability." Defense Minister Sakata
bed the basic oncept, s one for a "small armed force, but a
bigger load" for Japan. The Japanese view, in this conneCtion, should
be respected. It behooves us to be very cautious in taking any step that
could be interpreted by Asians, or by the Japanese people, as pressing
t to a quantitative inc in the size
of its defense force or to change its defnse posture in a significant
~;~~~~B~ ~ j .,,. ii r i~~W~ r:A""









8

spending totaling 5.5 percent of GNP and 24.8 percent of the budget
by the United ates. Japan n the world in military
pending but at thebottominrelationto per capita income, GNP, or
as a portion of the overll budget.
Agreement has been reached to establish a joint Defense Coopera-
tion Subcommittee to operate under the .S.-Japan Consultative Com-
miittee on Security, the basic focal point for discussion of security
treaty matters.,The Subcommittee wi have he responsibility to dis-
cuss guidelines for military cooperation between the two countries in
the event of an emergency. Offiials on both sides place much v on
the new subcommittee, See~iu it as a symbol of a new spirit of coop-
eration on security matters.
A. U.S. baie8 and persomiel
United States bases in Japan, partieularly those on Okinawa, are
still a source of tension although the situation is easing with contined
reduction in the number of bases and the drawdownof military per-
sonnel. .
Article VI of the UI.S.-Japan Security Treaty provides:
For the purpse of contribting tb the security of Japan and the tenance
of international peace and security in the Far East, the United States of
Aierica is granted the use by its, land, aid and naval, forces of facibties and
areas in. Japa. ....
In 11952, according ,to the .Japan Defense Agency, thre were e 2,824
U.S. military facilities in Japand of all sizes, covering 334,100 acres,
and occupied by 260,000 USservicemen. These facilties have now
been reduced to 136 and. take up, -25,089-acres;, the range in signi
eance from the huge-Kadena Air Base on Okinawa to antenna
site taking less than.ai atcre M-ost are small facilitiees with few people
attached. There ar Estill )50,0 UI.S...servicemen in Japan, along with
43.220 dependents and 3,768 ,civilian Department -of Defense em-
ployees. L-An for the bases is providd rent-fre The rnt onpri
owned land is paid to -the landowner by, thet Japanese govenment.
Thirty-eight of the facilities are used jointly by U.S. forces and the
Japanese Self-Defense. Forces. More than -half of. the base acreage
and nearly two-thirds of- the persnnel are located on Okinawa. O r
than- tose on Okinawa, measured by the number of personnel at-
tached, there are only seven major U.S. bases:
S U.S. military
"" .." fipersonnel attached
1. Yokota Air Base- Headquarters, U.S. Forces Japan ad of the 5th
Air Force --- ----------------------- --.------ 41
2. Camp Za-ima--Headquarters.of th ,e .S. Army-n Japan ---------------91...
3. Yokosuka-leadquarters, U, S. Naal Fores in Japan ----,--------, .1,
4. Iwakuni Air Station-Air Base for 'irst Marine Air.Wing ------- 5,102
5. Atsugi Naval Air Facility-7th Flee Naval Air Facility-------- 614
6. Misawa Air Base-Air Force Basell--__-- ------------_---------3 081
7. -Ssebo-Naval base -- ------.........--..-----.---------------------- 168.. ._
4 What has happened on the northern island of Hokkaido microosm ofthe kind of
contraction in the U.S. Dresenee in most parts of Japan over the last onarter of a ceutury,
At.the end of W War 11, the military cupation t U.. troops into
Hokkaido. mostly centered on the capital city of S poro t least a divon remain
during the Korean War. In 1999, the airfeld for oro to Jan and U.S.
forces were cut back to a communications unit. By 1970, only a guard unit of 200 m
remaind. It was not until June of 1975 that this unit was witdrat. What is left of te
U.S. military presence is a Cpast Guar "LORAN" unit on the Hkkaido.coast.Theoffi-
cial U.S. presence now consist of a onsulate n pporo, with tee Americans a
U.S.I.S. center run by an American and a specialist from the Department of Agriculture,
on a temporary basis.





33


9



rental, $104 illion in compensation to impacted communities, and
$1 million for the costs of reducing the 'number of bases through
consolidation. All new construction in connection with the consolida-
tionf facilities is paid for by te Japanese government.
1. Okinava.-Although anti-U.S. military base pressures on the
Jaaand seem to have eased, there is still strong public op-
position to American bases on Okinawa. Twenty percent of the land
area of the island of Okinawa is occupied by U.S. bases and they take
up to 12% of the Ryukyu Islands chain. A joint decision was reached
recently to return twelve additional U.S. facilities, including a firing
range on leima Island which has been the source of much local con-
troversy. After these reversions take place, the area occupied by the
U.S. bases will be reduced from 12 percent to 9.8 percent of the total
land area of the island chain.
Okina wans have strong feelings about the bases, which are scattered
thlroughout the island in a checkerboard .fshion. Residents carry a
bitter legacy of anti-ilitar feeling as a residue from World War II,
when 150,000 Okinawans were.killed. There is also a widespread feel-
in that Okinawans are carrying a disproportionate burden of Japans
eee eort, tht the are bei used in Tokyo. They are s -
cerned over the possibility of beingc-sucked into an outside war regard-
'less-f te fact that they -1dno fel threatened by any external power.
Recently the oosito candidate forgovernor won in a close elee-
tionwt k that alledfr remov f all U.S. bases and per-
onnel although the pro-Toko vernent candidate also favored
sbstantial, reductions..It. is-impossibleto determine how significant a
factor the differences in the viewsof the candidates on the bases was
in the electio but officia in Tokyo with whomI discussed the situa-
tion were acutely aware of the sensitivity of the base issue to Okina-
ans. It is an issue easily suscetble to political exploitation through-
Althou the bases account for 1 percent or more of Okinawa's in-
come. this-fact ds t ppear to have softened the persistent public
resentment against the U.S. military presence. The 32.000 remaininwr
servicemen in their concentrated U.S. communities still stick out lik
Stheland, lthough incidents of overt personalhos-
tility arebecoming rarer. It is interesting to note that there are only
bo 5,000 mebers of the Japanese SelfDefense Force on Okina,
sig land which totals less than one percent of the area used by
American forces. There is little joint use of facilities; the Japanese air
units, for example-, do not have a firing range and must return to the
part fm Okinawam a h y U.S.ilita concentration exists in
the Tokyo-Yokohama area, the most densely populated part of Japan
and is bein reduced onlyslowl. The Sanno otel whichhas been
hee U.S. Army since occupation days is an example. Located
i the heart of Tokyo. the hotel is sed primarily or U.S. military
personnel on leave andavelers oil
ory. i io. ty J. governmeit atd








10

the owners of the property have been trying to get the United States
to release this building. Finally, late last year, after taking the
Japanese government to court, the owner won a settlement alling for
payment of comensreturn of the prpert within five
ears. But the U.S. still insists on
Tokyo area before it will relinquishthe Sanno, notwithstanding the
fact that any valid military justification for retaining this particular
facility ended long ao
The reduction and consolidation of U.S. bases in Japan which is
spurred by pressures of budget limitations, teeply-climbing prices
Japan, and Japanese cooperation, is generally headedin the right
direction. It should continue, on the basis of close consultation at all
times with Japanese officials.
m. ECONOMIC RELATIONS
Japanese and American economic interests are inextricably en-
twined. America is Japan's largest market and Japan is our mo
important market, aside from Canad Currently the United States
absorbs soe 24 percent of Japan's exprts, d n from a derably
higher proportion several years ago, marking thdiversification of
Japan's foreignmarkets.
There have, of course, been problems with ur trade in th past
over steel, textiles and other items-but with time, restraint, and con
cessions on both sides these problems have been surmounted. Other
bilateral trade difficulties are to be anticipated inwthe future. With
goodwill, cooperation, and derstanding of mutual n these prob-
lems should also be manageable. There ay well be afor addi-
tional mechanisms for day-to-day- dialogue between the two govern-
ments on economic issues, both to find solutions to prle before
they become critical as well as to provide forums for discussion of
matters of mutual interest "
A matter of potential concern for the immediate future, is the re-
appearance of a growing gap in bilateral trade balances. Japanese ex-
ports to the United States for January-April 1976' xceeded imorts
from the United States by $1.628 billion, compared wit a deficit of
$735.5 million for the last four months of 1975.
Japan's economic growth rate this year, in real terms, is estimated at
6.2 percent which will result in a GNP of $515.6 billio, somewhat
more than one-third of that of the United States. Inflation has been
brought under reasonable control and is now running at an annual
rate of 8.8 percent. Unemployment is 2 percent, although U.S. and
Japanese figures are not comparable due to different employment
practices. Environmental issues are of growing public concern
Japan and expenditures for environmental protection now absorb
some 13 percent of all capital expenditures compared with about 5
percent for comparable spending in the United States.
As is the case with most other raw materials, Japan is heavily de-
pendent for its energy requirements on foreign sources and it will con-
tinue to be for the foreseeable future. Eighty-nine percent of its enery
needs are derived from niports (seventy-seven peirent from oil).
Under a ten-year plan for energy development, its dependence for-
eign energy sources will be reduced by only seven percent. Japan's





35


11

omQiuestic petroleum production is negligible, although some drilling is
underway a offshore sites.
Other than the trade deficit, which to a great extent is a factor of
the uneven recovery rates of our respective economies, there are only
two major bilateral issues of current concern, fisheries and air routes.
The Japanese people depend on fish for 60 percent of their protein
and are heavily dependent on ocean fishery resources. They are deeply
concerned over the. potential impact of the recently entl acted law to
establish a 200 mile territorial limit for fishing (P.L. 94-265). I ex-
plained to the officials who raised this matterat at the Congress voted
this interim measure out of self-defense following repeated failures
by the United Nations Law of the Sea Conference to arrive at an in-
ternational agreement; after many nations had unilaterally increased
their territorial claims to 200 miles; and that imposition of the limit
would be held in abeyance for an additional period to give the U.N.
Conference more time to come up with a solution. Discussions between
Japanese and U.S. officials over the implementation of the new law
have begun and it is to be hoped that a satisfactory bilateral solution
can be found, assuming that the U.N. Conference again fails to pro-
duce an international accord. The air route issue involves a Japanese
desire for new ports of entry into the United States and it is also likely
to involve requests by U.S. airlines for the right to continue service
to Okinawa.
The Lockheed affair, or Lockheed "typhoon," as one official called
it, is Japan's Watergate. It is a Japanese-not an American-prob-
lein. Thus far, it appears that the affair has had no major adverse ef-
fect on Japan-U.S. relations. However, it has had an impact on the
conscience of the Japanese public and may eventually set in motion
significant changes in Japan's political structure and alinement. In
my udgment, the American political system has not only survived
the Waterate affair, in the end, it may be strengthened by it. It is
rely possible that the Lockheed scandal could have the same effect

The Senate Committee on Foreign Relations has turned over to the
Ex~cutive Branch all information in its posssion relating to the af-
fair for transittal to tthe Japanese government. Japanese officials
are aware that Congress had been fully cooperative with their govern-
ment on the matter.
Looking to the future,. it is in the interest of Japan. the United
States, and the world to establish international ground rules to control
Snder-the-table business dealings and political manipulations like
those involved in the Lockheed affair. In this era of multinational
rratios and state trading, a single icountry cannot do much, acting
alon. to pre such practices. "Multinational firms," one Japanese
official a d, "cannot be checked through individual governments."
Thisdr rot in the world's commerce is an international problem and
sol s in a similar fashion can only be international. The United
Nations may well be peculiarly suited to this purpose.

IV. CONCLUDIXG OBSERVATIONS

Although the Japan-U.S. relationship began nearly a century and
a quarter ago, the unique meshing of our two countries' interests began





36


12

with the end of World War Japan hasthe
most powerful industrial democracy in the world. An unde the U.S.
security umbrella, Japan has been free of fear of otde attack and of
burdensome military spending. It has been able to devote its va en-
ergies to creating an economic machine of immense productivity.
In 1960, riots and widespread public protests against the mutual
security treaty with the United States caused the cancellation of Pres-
ident Eisenhower's plans to visit Japan. President Ford's visit to
Japan in 1974 and Emperor Hirohito's visit to the United States last
October, historic occasions for both nations, epitomized the chang
which have taken place in our relationship since thatime. At no
period in our post-war history have U.S. relations with Japan been
better.
But as the visit by Commodore Perry signaled the end of one era
for Japan, an era of isolation from the outside world, we have entered
a new era in our contemporary relationship. The end of the post-war
era was signaled by the 1972 Okinawa reversion agreement. We have
now reached a new plateau, where trust in affairs of mutual concern
is essential to both countries. We cannot afford either to preach to the
Japanese, to patronize them, or to ignore their legitimate interests.
The only basis for trust is to treat with one another on the basis of
equality.
The U.S.-Japan security treaty is more than a pledge to main-
tain a stable and peaceful Pacific. It is a symbol of the need for day-
to-day cooperation between Japan and the United States across a
range of human activities. The partnership begun at the end of World
War II should be strengthened by additional mechanisms for consul-
tation and discussion, building on the precedent of the recently cre-
ated Joint Defense Cooperation Subcommittee.
Japan is the only major nation in the world which has rejected
military power as the basis for the protection and advancement of its
interests. Japan is in a unique position, therefore, to exercise leader-
ship in dealing with the problems which will increasingly trouble the
world in the years ahead. Environmental issues, shortages of energy
and other resources, food and population problems, the world arms
burden and nuclear dangers-all are matters with regard to which
Japan is uniquely situated to play an international role of leadership.
Japan's unique position in the world warrants a permanent seat on the
United Nations Security Council and an amendment to the U.N. Char-
ter to that end would be in order.
There may be shifts in Japanese political currents in the period
ahead as Japan goes through a period of reassessment.It is especially
important that United States officials become better acquainted with
and more closely attuned to the broader spectrum of Japanese opinion.
A greater exchange of academicians, politicians, journalists, cultural
leaders, and others would be in the longrange interests of both
countries.
Japanese and American policy interests in the Far East are well
served by continuation of the present security treaty relationship. Jap-
anese confidence in the United States commitment is a key factor for
stability in the area. I found no evidence of a move to change Japan's
military status in such a way as to cause her neighbors conce Nor
is there any reason that a further reduction in U.S. bases and forces





37


13

should create uncertainty about the U.S. treaty commitment. Contin-
uation of the present policy to consolidate and eliminate non-essential
facilities is desirable, economical and will serve our common interests.
U.S.-Japan relations are good but they could be better. The era of
patron-client is over. A new relationship on the basis of equality and
a mutuality of interests has begun. Professor Edwin Reischauer de-
scribed the potential of thla relationship as a pattern for the world's
future in this way:
If we and the Jaan the nese can build a fully equal relationship of complete trust
and cooperation as the two leading members of the group of industrialized
democracies, this may be a hopeful sign that in time other such relationships can
be built across the chasms of racial and cultural difference, as we move toward.
creating a truly viable "one world."
This is a worthy goal for both countries.

V. RECOMMIENDATIONS
The recommendations which are contained in this report may be
summarized as follows:
1. No more "shocks". Wherever feasible, joint mechanisms should be
established for periodic consultations on problems of common concern.
Our unique relationship warrants unique approaches to insure a con-
tinuing dialogue, at all levels, on matters of mutual interest.
2. Japan should obtain a permanent seat on the U.N. Security
Council.
3. The reduction and consolidation of U.S. military facilities and
personnel should continue in close consultation with the Japanese
ogovernment.
4. There should be broadened contacts, official and unofficial, be-
tween Japan and the United States.
5. The United Nations should undertake to develop a treaty en-
compassing a code of conduct for international commercial dealings
which would outlaw practices such as those involved in the Lockheed
affair.
6. There should be a gradual withdrawal of U.S. ground forces
from South Korea as that nation's military strength improves..




















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8 ~

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1. TREATY OF MUTUAL COOPERATION AND SECURITY BETWEEN THE UNITED STATES
OF AMERICA AND JAPAN

Signed at Washington January 19. 1960: Ratification adivsed by the Senate of
theUnited States of America June 22, 1960; Ratified by the President of the
United States of America June 22, 190; Ratified by Japan June 21, 1960; Rati-
fications exchanged at Tokyo June 23. 1960; Proclaimed by the President of the
United States of America June 27, 1960; Entered into force June 23, 1960. With
Agreed Minute and Exchanges of Notes.
The United States of America and Japan,
Desiring t strengthen the bonds of peace and friendship traditionally exist-
ing between them, and to uphold the principles of democracy, indvidual liberty,
and the rule of law.
Desiring further to encourage closer economic cooperation between them and
to promote conditions of economic stability and well-being in their countries.
Reaffrming their faith in the purposes and principles of the Charter of the
United Nations, and their desire to live in peace with all peoples and all govern-
ments,
Recognizing that they have the inherent right of individual or collective self-
defense as affrmed in the Charter of the United Nations,
Considering that they have a common concern in the maintenance of inter-
national peace and security in the Far East,
Having resolved to conclude a treaty of mutual cooperation and security,
Therefore agree as follows:
ARTICLE I
The Parties undertake, as set forth in the Charter of the United Nations. to
settle any international disputes in which they may be involved by peaceful
means in such a manner that international peace and security and justice are not
endangered and to refrain in their international relations from the threat or use
of force against the territorial integrity or political independence of any state, or
in any other manner inconsistent with the purposes of the United Nations.
The Parties will endeavor in concert with other peace-loving countries to
strengthen the United Nations so that its mission of maintaining international
peace and security may be discharged more effectively.

ARTICLE I1
The Parties will contribute toward the further development of peaceful and
friendly international relations by strengthening their free institutions, by bring-
in about a better understanding of the pirneiples upon which these institutions
are founded. and by promoting conditions of stability and well-being. They will
seek to eliminate conflict in their international economic policies and wiil en-
courage economic collaboration between them.

ARTICLE III
The Parties, individually and in cooperation with each other, by means of
continuous and effective elf-help and mutual aid will maintain and develop,
subject to their constitutional provisions, their capacities to resist armed attack.

ARTICLE IV
The Parties will consult together from time t time regarding the implementa-
Seither rty whenever the security of
Japan or international peace and security in the Far East is threatenled.


( 9 ) "\ .,- i s
~~ ~ ~ ~; "'r i~ ';'' "" *"' *' . .. -.1 V !!. .....






40



16

ARTICLE V
Each Party recognizes that a attack against either Party in the terri-
tories under the administration of Japan would be dangerous to its own peace
and safety and declares that it would act to meet the common danger in accord-
ance with its constitutional provisions and processes.
Any such armed attack and all measures taken as a result thereof shall be
Immediately reported to the Security Council of the United Nations in accord-
ance with the provisions of Article 51 of the Charter. Such measures shall be
terminated when the Security Council has taken the measures necessary to
restore and maintain international peace and security.

ARTICLE VI
For the purpose of contributing to the security of Japan and the maintenance
of international peace and security in the Far East, the United States of America
is granted the use by its land, air and naval forces of facilities and areas in
Japan.
The use of these facilities and areas as well as the status of United States
armed forces in Japan shall be governed by a separate agreement, replacing the
Administrative Agreement under Article III of the Security Treaty between the
United .States of America and Japan, signed at Tokyo on February 28, 1952, as
amended, and by such other arrangements as may be agreed upon.

ARTICLE VII
This Treaty does not affect and shall not be interpreted as affecting in any
way the rights and obligations of the Parties under the Charter of the United
Nations or the responsibility of the United Nations for the maintenance of inter-
national peace and security.
ARTICLE VIII
This Treaty shall be ratified by the United States of America and Japan in
accordance with their respective constitutional processes and will enter into
force on the date on which the instruments of ratitiation thereof have been ex-
changed by them in Tokyo.
ARTICLE IX
The Security Treaty between the United States of America and Japan signed
at the city of San Francisco on September 8, 1951 shall expire upon the entering
into force of this Treaty.
ARTICLE X
This Treaty shall remain in force until in the opinion of the Governments of
the United States of America and Japan there shall have come into force such
United Nations arrangements as will satisfactorily provide for the maintenance
of international peace and security in the Japan area.
However, after the Treaty has been in force for ten years, either Party may
give notice to the other Party of its intention to terminate the Treaty, in which
case the Treaty shall terminate one year after such notice has been given.


AGREED MINUTE TO THE TREATY OF MUTUAL COOPERATION AND SECURITY BETW
THE UNITED STATES OF AMERICA AND JAPAN

Japanese Plenipotentiary
While the question of the status of the islands administered by the United
States under Article 3 of the Treaty of Peace with Japan has not been made a
subject of discussion in the course of treaty negotiations. I would like to em-
phasize the strong concern of the Government and people of Japan for the safety
of the people of these islands since Japan possesses residual sovereigty over
these islands. If an armed attack occurs or is threatened against these islands,
the two countries will of course consult together closely under Article IV of
the Treaty of Mutual Cooperation and Security. In the event of an armed attack,
it is the intention of the Government of Japan to explore with the United States
measures which it might be able to take for the welfare of the slanders.






41


17

United States Plenipotentiary
In the event of an armed attack against these islands, the United States Gov-
ernment will consult at once with the Government of Japan and intends to take
the necessary measures for the deense of these islands, and to do its utmost to
secure the welfare of the islanders.


NGES OF TE THE NT STATES AND JPA DATED
JANUARY 19,1960
His Excellency CHRISTIAN A. HERTER,
Secretary of State of the United States of Amerida.
EXC: I ha thonour to refer to the Treaty of Mutual Cooperation
and Security between Japa and the United States of America signed today, and
to nform Your Excellency that the following is the understanding of the Govern-
ment of Japan concerning the mplementation of Article VI thereof:
"Major changes in the deployment into Japan of United States armed forces,
major anges in their equipment, and the use of facilities and areas in Japan
as bases for military combat operation to be undertaken from Japan other than
conucted under Article V of the said Treaty, shall be the subjects of prior
consultation with the Government of Japan."
I should be appreciative if Your Excellency would confirm on behalf of your
Government t this is also the understanding of the Government of the United
States of America.
I avail myself of this opportunity to renew to Your Excellency the assurance
of my highest consideration.
NOBUSUKE KIHI.
His Excellency OBUUKE KISHa,
Prime Minister of Japan.
EXELENY : I have the honor to acknowledge the receipt of Your Excellency's
Notf today's date, which reads as follows:
"I have the honour to refer to the Treaty of Mutual Cooperation and Security
between Japan and the United States of America signed today, and to inform
Your E llency that the following is the understanding of the Government of
Japan conernig the implementation of Article VI thereof:
Mao changes in the deployment into Japan of United States armed forces,
major n their equipment, and the use of facilities and areas in Japan as
baes r military combat operations to be undertaken from Japan other than
those conducted under Article V of the said Treaty, shall be the subjects of prior
consultation with the Government of Japan.
"I s be appreciative if Your Excellency would confirm on behalf of your
rm that this is also the understanding of the Government of the United
States of America.
"I avail myself of this opportunity to renew to Your Excellency the assurance
of my highest consideration."
I have the honor to confirm on behalf of my Government that the foregoing
is also the understanding of the Government of the United States of America.
Accept, Excellency, the renewed assurances of my highest consideration.
CHuRITIAN A. HERTER,
Secretary of State of the
United States of America.

His Excellency NOBUSUKE KSHI,
Prime Minister of Japan.
EXCELLENCY I have the to refer to the Security Treaty between the
United tates of America and Japan signed at the city of San Francisco on
September 8, 1951, the exchange of n effected on the sa date between Mr.
Shieru Yoshida, Prime Minister of Japan, and Mr. Dean Acheson, Secretary
of State of the United States of America, and the Regarding the
Status of the United Nations Forces in Japan signed at Tokyo on February 19,
1954, as well as the Treaty of Mutual Cooperation and Security between the






42


18

United States of America and Japan signed today. is the uers
Government that:
1. The above-mentioned exchange of notes will continue to be i force so long
as the Agreement Regarding the Status of United Na i J
remains in force. :
2. The expression "those facilities and areas the use of which is providedto
the United States of America under the Seurity Treaty between Japan and
the United States of America" in Article pa raph of the abve-ment
Agreement is understood to mean the faclities' and areas the use of whih is
granted to the United States of America under the Treaty of Mutual- oopera-
tion and Security.
3. The use of the facilities and areas by the United States armed force under
the Unified Command of the United Nations established pursuant to the Security
Council Resolution of July 7, 1950, and their status in Japan are governed by
arrangements made pursuant to.the Treaty of Mtual Coopeation nad S
I 'should be grateful if Your Excellency coul confirm on behalf of your
Government that the understanding of my Government stated in othe oegog
numbered paragraphs s also the understanding of your Government and that
this .understanding shall enter into operation on the date of the entry force
of the .Treaty of Mutual Cooperation and Security signed at Washon
January 19 1960.
Accept, Excellency, the renewed assurances of my highest consideation.
CHRISTIAN A. HERTER,
Secretary of State of tlhe
*United States of America.

His Excellency CHRISTIAN A. HERTER,
Secretary of State, of the United States of America.
EXCELLENCY: I have the honour to acknowledge the receipt of Your Excel-
lency's Note of today's date, which reads as follows:
"I have the honor to refer to the Security Treaty between the United
States of America and Japan signed at the city of San Francisco on Sep-
tember 8, 1951, the exchange of notes effected on the same date between Mi .
Shigeru Yoshida, Prime Minister of Japan, and Mr. Dean Acheson, Secretary
of State of the United States of America and the Agreement Regarding the
Status of the United Nations Forces in Japan signed at Tokyo on February
19, 1954, as well as the Treaty of Mutual Cooperation and Security between
the United States of America and Japan signed today. It is the understand-
ing of my Government that.:
1. The above-mentioned exchange of notes will continue to be in force
so long as the Agreement Regarding the Status of the United Nations Forces
in Japan remains in force.
2. The expression 'those facilities and areas the use of which is provided
to the United States of America under the Security Treaty between Japan
and the United States of America' in Artic!e V, paragraph 2 of the above-
mentioned Agreement is understood to mean the facilities and the areas the
use of which is granted to the United States of America under the Treaty
of Mutual Cooperation and Security.
3. The use of the facilities and areas by the United States armed forces
under the Unified Command of the United Nations established pursuant to
the Security Council Resolution of July 7, 1950. and their status in Japan
are governed by arrangements made pursuant to the Treaty of Mutual Co-
operation and Security.
"I should be grateful if Your Excellency could confirm on behalf of your
Government that the understanding of my Government stated in the fore-
going numbered paragraphs is also the understanding of your Government
and that this understanding shall enter into operation on the date of the
entry into force of the Treaty of Mutual Cooperation and Security signed
at Washington on January 19, 1960."
I have the honour to confirm on behalf of my Government that the foregoing
is also the understanding of the Government of Japan.
I avail myself of this opportunity to renew to Your Excellency the assurance
of my highest consideration.
NOBUSUKE KISHI.






43


19

His Excellency CHRIsTIAN A. HERTER,
Secretary of State, of the United States of America.
DEAR SECRETARY HERTER: I wish to refer to the Treaty of Mutual Cooperation
and Security between Japan and the United States of America signed today.
Under Article IV of the Treaty, the two Governments will consult together from
time to time regarding the implementation of the Treaty, and, at the request of
either Government, whenever the security of Japan or international peace and
security in the Far East is threatened. The exchange of notes under Article VI
of the Treaty specifies certain matters as the subjects of prior consultation with
the Government of Japan.
Such consultations will be carried on between the two Governments through
appropriate channels. At the same time, however, I feel that the establishment
of a special committee which could as appropriate be used for these consulta-
tions between the Governments would prove very useful. This committee, which
would meet whenever requested by either side, could also consider any matters
underlying and related to security affairs which would serve to promote under-
standing between the two Governments and contribute to the strengthening of
cooperative relations between the two countries in the field of security.
Under this proposal the present "Japanese-American Committee on Security"
established by the Governments of the United States and Japan on August 6,
1957, would be replaced by this new committee which might be called "The
Security Consultative Committee". I would also recommend that the member-
ship of this new committee be the same as the membership of the "Japanese-
American Committee ritee on Security", namely on the Japanese side, the Minister
for foreign Affairs, who will preside on the Japanese side, and the Director
General of the Defense Agency, and on the United States side, the United States
Ambassador to Japan, who will serve as Chairman on the Untied States side,
and the Commander-in-Chief, Pacific, who will be the Ambassador's principal
advisor on military and defense matters. The Commander, United States Forces,
Japan, will serve as alternate for the Commander-in-Chief, Pacific.
I would appreciate very much your views on this matter.
Most sincerely,
NOBUSUKE KSHI.
His Excellency
NOBUSUKE KIsII.
Prime Minister of Japan.
DEAR MR. PRIMEi MINISTER:
The receipt is acknowledged of your ote of today's date suggesting the estab-
lishment of "The Security Consultative Committee". I fully agree to your pro-
posal and share your view that such a committee can contribute to strengthen-
ing the cooperaive relations between the two countries in the field of security.
I also agree to your proposal regarding the membership of this committee.
Most sincerely,
CHRISTIAix A. HERTER.





















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2. AGREEMENT UNDER ARTICLE VI OF THE TREATY OF MUTUAL COOPERBATION AND
SECURITY BETWEEN THE UNITED STATES OF AMERICA AND JAPAN, REGARDING
FACILITIES AND AREAS AND THE STATUS OF UNITED STATES ARMED FORCES IN
JAPAN
The United States of America and Japan, pursuant to Article VI of the Treaty
of Mutual Cooperation and .Security between the United States of America and
Japan signed at Washington on January 19, 1960, have entered into this Agree-
ment in terms as set forth below:
ARTICLE I
In this Agreement the expression-
(a) "members of the United States armed forces" means the personnel on
active duty belonging to the'land, sea or air armed services of the United States
of America whe n Ith tterritory of Japan.
(b) "civilian component" means the civilian persons of United States nation-
ality who are in the employ of, serving with, or accompanying the United States
armed forces in Japan, but excludes persons who are ordinarily resident in
Japan or who are mentioned in paragraph 1 of Article XIV. For the purposes of
this Agreement only, dual nationals, United States and Japanese, who are brought
to Japan by the United .States shall be considered as United States nationals.
(c) "dependents" means
(1) Spouse, and children under 21;
(2) Parents, and children over 21, if dependent for over half their support
upon a member of the United States armed forces or civilian component.
ARTICLE II
1. (a) The United States is granted, under Article VI of the Treaty of Mutual
Cooperation and Security, the use of facilities and areas in Japan. Agreements
as to specific facilities and areas shall be concluded by the two Governments
through the Joint Committee provided for in Article XXV of this Agreement.
"Facilities and areas" include existing furnishings, equipment and fixtures neces-
sary to the operation of such facilities and areas.
(b) The facilities and areas of which the United States has the use at the time
of expiration of the Administrative Agreement under Article III of the Security
Treaty between the United States of America and Japan, shall be considered as
facilities and areas agreed upon betweenthe two Governments in accordance
with subparagraph (a) above.
2. At the request of either Government, the Governments of the United States
and Japan shall review such arrangements and may agree that such facilities
and areas shall be returned to Japan or that additional facilities and areas may
be provided.
3. The facilities and areas used by the United States armed forces shall be re-
turned to Japan whenever they are no longer needed for purposes of this Agree-
ment, and the United States agrees to keep the needs for facilities and areas
under continual observation with a view toward such return.
4. (a) When facilities and areas are temporarily not being used by the United
States armed forces, the Government of Japan may make, or permit Japanese
nationals to make, interim use of such facilities and areas provided that it is
agreed between the two Governments through the Joint Committee that such
use would not be harmful to the purposes for which the facilities and areas are
normally used by the United States armed forces.

armed forces for limited periods of time, the Joint Committee shall specify in
the agreements covering such facilities and areas the extent to which the pro-
visions of this Agreement shall apply.
(21)

(45)






46


22

ARTICLE III
1. Within the facilities and areas, the United States may take all the measures
necessary for their establishment, operation, safeguard and contro In order
to provide access for the United States armed forces to the facilities and areas
for their support, safeguarding and control, the Govern met of Japan s at
the request of the United States armed forces and upon consultation between
the two Governments through the Joint Committee, take necessary measures
within the scope of applicable laws and regulations over land, territorial aters
and airspace adjacent to, or in the vicinities of the facilities and areas. The
United States may also take necessary measures for such purposes upon con-
sultation between the two Governments through the Joint Committee.
2. The United States agrees not to take the measures referred to in paragraph
1 in such a manner as to interfere unnecessarily with navigation, aviation, com-
munication, or land travel to or from or within the territories of Japan. All
questions relating to frequencies, power and like matters used by apparatus em-
ployed by the United States designed to emit electric radiation shall be settled
by arrangement between the appropriate authorities of the two Governments.
The Government of Japan shall, within the scope of applicable laws and regula-
tions, take all reasonable measures to avoid or eliminate interference with tele-
communications electronics required by the United States armed forces.
3. Operations in the facilities and areas in use by the United States armed
forces shall be carried on with due regard for the public safety.

ARTICLE IV
1. The United States is not obliged, when it returns facilities and areas to
Japan on the expiration of this Agreement or at an earlier date, to restore
the facilities and areas to the condition in which they were at the time they
became available to the United States armed forces, or to compensate Japan
in lieu of such restoration.
2. Japan is not obliged to make any compensation to the United States for
any improvements made in the facilities and areas or for the buildings or
structures left thereon on the expiration of this Agreement or the earlier return
of the facilities and areas.
3. The foregoing provisions shall not apply to any construction which the
Government of the United States may undertake under special arrangements
with the Government of Japan.

ARTICLE V
1. United States and foreign vessels and aircraft operated by, for, or under
the control of the United States for official purposes shall be accorded access
to any port or airport of Japan free from toll or landing charges. When cargo
or passengers not accorded the exemptions of this Agreement are carried on
such vessels and aircraft, notification shall be given to the appropriate Japa-
nese authorities, and their entry into and departure from Japan shall be ac-
cording to the laws and regulations of Japan.
2. The vessels and aircraft mentioned in paragraph 1. United States Govern-
ment-owned vehicles including armor, and members of the United States armed
forces, the civilian component, and their dependents shall be accorded access
to and movement between facilities and areas in use by the United States armed
forces and between such facilities and areas and the ports or airports of Japan.
Such access to and movement between facilities and areas by United States
military vehicles shall be free from toll and other charges.
3. When the vessels mentioned in paragraph 1 enter Japanese ports, appro-
priate notification shall, under normal conditions, be made to the proper
Japanese authorities. Such vessels shall have freedom from compulsory pilotage,
but if a pilot is taken pilotage shall be paid for at appropriate rates.
ARTICLE VI
1. All civil and military air traffic control and communications systems
shall be developed in close coordination and shall be integrated to the extent
necessary for fulfillment of collective security interests. Procedures, and any
subsequent changes thereto, necessary to effect this coordination and integration






47


23

will be established by arrangement between the appropriate authorities of the

2 Lights and other aids to navigation of vessels and aircraft placed or es-
bli ties and areas in use by United States armed forces and
in territorial waters adjacent thereto or in. the vicinity thereof shall conform
to the stem iuse in Japan. The United States and Japanese.authorities
ch have established such navigation aids shall notify each other of their
positions and charateristics and shall give advance notification.before making.
any ch s in them or establishing additional navigation aids.
ARTICLE VII
The United States armed forces shall have the use of all public utilities and
services belonging to, or controlled or regulated by the Government of Japan,
and shall enjoy priorities in such use, under conditions no less favorable than
those that may be applicable from time to time to the ministries and agencies
of the Government of Japan.
ARTICLE vIII
The Government of Japan undertakes to furnish the United States armed
forces with the following meteorological services in accordance with arrange-
ts between the appropriate authorities of the thwo Governments:
(a) Meteorological observations from land and ocean areas including observa-
tions from weather ships.
(b) Climatological inforation including periodic summaries and the histori-
cal data of the Meteorological Agency.
(c) Telecommunications service to disseminate meteorological information re-
quired for the safe and regular operation of aircraft.
S(d Seismographic data including forecasts of the estimated size of tidal
waves resulting from earthquakes and areas that might be affected thereby.

ARTICLE IX
1. The United States may bring into Japan persons who are members of the
United States armed forces, the civilian component, and their dependents, sub-

2. Members of the United States armed forces shall be exempt from Japanese
passport and laws and reglations. Memers of the United States armed
forces, the cvilian component, and their dependents shall be exempt from Jap-
anese laws and regulations on the registration 'and control of aliens, but shall
not be considered as acquiring any right to permanent residence or domicile in
the territories of Japan.
3. Upon entry into or departre from Japan members of the United States
armed forces shall be In possession of the following documents:
(a) p a identiy card showing name, date of birth, rank and number,
service, and photograph; and
Sindividl or colective travel order certifying to the status of the idi-
lor group asa er or members of the United States armed forces and

Fo es f ter identicon whil in aa members of the United
States armed for shall b in possession of the foregoing personal identity card
which must be presented on request to the appropriated Japanese autlhorities.
4. Mebers ~'f the civ n c nent, their dependents, and the dependeuts
of members of the United States armed forces shall be in possession of. appro-
priate doc ntatio issud by the Uited States authorities so that their status
may be verified by Japanese authorities upon their entry into or departure from

5. If the status of any person brought into Japan under paragraph 1 of this
Article i alteredo that he would no longer etitle to such admission, the
United States authoriies shall notify the Japanese authorities and shall, if such
person be required by the Japanese authorities to leave Japan, assure that trans-
portation from Japan will be provided within a reasonable time at no cost to the
Government of Japan.
6. If the Government of Japan has requested the removal from its territory-
of a .member of the United States armed forces or civilian component orhas
made an expulsion order against an ex-member of the United States armed.






48


24

forces or the civilian component or against a dependent of a member or ex-
member, the authorities of the United States rle for receiving
the person concerned within its own territory or otherwise disposing of him
outside Japan. This paragraph shall apply only to persons who are not nationals
of Japan and have entered Japan as members of the United States armed forces
or civilian component or for the purpose of becoming such members, and to the
,dependents of such persons.
ARTICLE X
1. Japan shall accept as valid, without a driving test or fee, the dving permit
or license or military driving permit issued by the United States to a member
of the United States armed forces, the civilian component, and their dependents.
2. Official vehicles of the United States armed forces and the civilian com-
ponent shall carry distinctive numbered plates or individual markings which
will readily identify them
3. Privately owned vehicles of members of the United States armed forces,
the civilian component, and their dependents shall carry Japanese number plates
to be acquired under the same conditions as those applicable to Japanese
nationals.
ABTICLE XI
1. Save as provided in this Agreement, members of the United States armed
forces, the civilian component, and their dependents shall be subject to the laws
and regulations administered by the customs authorities of Japan.
2. All materials, supplies and equipment imported by the United States armed
forces, the authorized procurement agencies of the United States armed forces,
or by the organizations provided for in Article XV, for the official use of the
United States armed forces or for the use of the members of the United States
armed forces, the civilian component, and their dependents, and materials, sup-
plies and equipment which are to be used exclusively by the United States armed
forces or are ultimately to be incorporated into articles or facilities used by
such forces, shall be permitted entry into Japan; such entry shall be free from
customs duties and other such charges. Appropriate certification shall be made
that such materials, supplies and equipment are being imported by the United
States armed forces, the authorized procurement agencies of the United States
armed forces, or by the organizations provided for in Article XV, or, in the
case of materials, supplies and equipment to be used exclusively by the United
States armed forces or ultimately to be incorporated into articles or facilities
used by such forces, that delivery thereof is to be taken by the United States
armed forces for the purposes specified above.
3. Property consigned to and for the personal use of members of the United
States armed forces, the civilian component, and their dependents, shall be
subject to customs duties and other such charges, except that no duties or
charges shall be paid with respect to:
(a) Furniture and household goods for their private use imported by the
members of the United States armed forces or civilian component when they first
arrive to serve in Japan or by their dependents when they first arrive for
reunion with members of such forces or civilian component, and personal effects
for private use brought by the said persons upon entrance.
(b) Vehicles and parts imported by members of the United States armed
forces or civilian component for the private use of themselves or their dependents.
(c) Reasonable quantities of clothing and household goods of a type which
would ordinarily be purchased in the United States for everyday use for the
private use of members of the United States armed forces, civilian component,
and their dependents, which are mailed into Japan through United Statemili-
tary post offices.
4. The exemptions granted in paragraphs 2 and 3 shall apply only to cases of
importation of goods and shall not be interpreted as refunding customs duties
and domestic excises collected by the customs authorities at the time of entry
in cases of purchases of goods on which such duties and excises have already
been collected.
5. Customs examination shall not be made in the following cases:
(a) Units of the United States'armed forces under orders entering or leaving
Japan;
(b) Official documents under official seal and official mail in United States
military postal channels;






49


25

(c). Military arg shipped on a United States Government bill of .lading.
6. Except as such disposal may be authorized by the United States and Japa-
nese authorities in accordance with mutually agreed conditions, goods imported
into Ja free of duty shall not be disposed of in Japan to persons not entitled
to import such goods free of duty.
7. G imported into Japan free from customs duties and other such charges
purant to agraph and 3, may be re-exported free from customs duties
and other such charges. ,
e ted States armed forces, in cooperation with Japanese authorities,
take such steps as are necessary to prevent abuse of privileges granted to
the United States armed forces, members of such forces, the civilian component,
their dependents in accordance with this Article.
(a) In order to prevent offenses against laws and regulations administered
by the cuts authorities of the Government of Japan, the Japanese authori-
ties and the United States armed forces shall assist each other in the conduct
of inquiries and the collection of evidence.
(b) The United States armed forces shall render all assistance within their
power to ensure that il iable to seizure by, or on behalf of, the customs
authorities of the Gover t of Japan are handed to those authorities.
(c) The United States armed forces shall render all assistance within their
power to ensure the payment of duties, taxes, and penalties payable by members
such forces or of the civilian component, or their dependents.
(d) Vehicles and articles belonging to the United States armed forces seized
the customs authorities of the Government of Japan in connection with an
offense against its customs or fical laws or regulations shall be handed over
to te appropriate authorities of the force concerned.
ARTICLE XII
1. The United States may contract for any supplies or construction work to be
frshed or undertaken in Japan for purposes of, or authorized by, this Agree-
ment, without restriction as to choice of supplier or person who does the con-
struction work. Such supplies r co ction work may, upon agreement between
the appropriate authorities of the two Governments, also be procured through

2. Materials, supliesequipment and services which are required from local
the ce of the United States armed forcesand the proure-
ment of which may hve an adverse effect on the economy of Japan shall be
procured in coordination with, and, when desirable, through or with the assist-
ance of, the competent authorities of Japan.
3. Materials, supplies, equipment and services procured for official purposes
in Japan by the United States rmed forces, or by authorized procurement
agencies of the United tates armed forces upon appropriate certification shall
be exempt from the following Japanese taxes: (a) Commodity tax; (b) Travel-
ling tax; (c) Gasoline tax; (d) Electricity and gas tax.
Maerials, supplies, quipmet and services procured for ultimate use by the
United States armed forces shall be exempt from commodity and gasoline taxes
upon appropriate certification by the Unte States armed forces. With respect
to any present or future Japanese taxes not lly referred to in this Article

the gross purchase price of materials, supplies, equipment and services procured
by the United States armed forces, or fr ultimate use by such forces, the two
Governments will agree upon a procedure for granting such exemption or relief
therefrom as is consistent with the purposes of this Article.
4. Local labor requirements of United States armed forces and of the organiza-
tions provided for in Article XV shall be satisfied with the assistance of the

5. The obligations for the witholding and payment of income tax, local in-
habitant tax and social security contributions, and, except as may otherwise
be mutually agreed, the conditions of employment and work, such as those re-
lating to wages and supplementary payments, the conditions for the protection
laid down by the legislation of Japan.
6. Should the United States armed forces or as appropriate an organization
provided for in Article XV dismiss a worker and a decision of a court or a Labor









26

Relations Commission of Japan to the eect that the contract of emplo t as
not terminated become final, the following procedure shall apply:
(a) The United States armed forces or the said or shall be informed
by the Government of Japan of the decision of the court or Co ission;
(b) Should the United States armed forces or the said organization not desire
to return the worker to duty, they shall so notify the Government of Japan within
seven days after being informed by the latter of the decision of the court or
Commission, and may temporarily withhold the worker from duty;
(c) Upon such notification, the Government of Japan and the United States
armed forces or the said organization shall consult together without delay with
a view to finding a practical solution of the case;
(d) Should such a solution not be reached within a period of thirty days from
the date of commencement of the consultations under (c) above, the worker will
not be entitled to return to duty. In such case, the Government of the United
States s pay to the Government of Japan an amount to the erene lo the cost of em-
ployment of the worker for a period of time to be agreed between the two Gov-
ernments.
7. Members of the civilian component shall not subjet ect to Japanese laws or
regulations with respect to terms and conditions of employment.
8. Neither members of the United States armed forces, civilian component, nor
their dependents, shall be reason of this Article enjoy any exemption from taxes
or similar charges relating to personal purchases of goods and services in Japan
chargeable under Japanese legislation.
9. Except as such disposal may be authorized by the United States and Japa-
nese authorities in accordance with mutually agreed conditions, goods purchased
in Japan exempt from the taxes referred to in paragraph 3, shall not be dispsed
of in Japan to persons not entitled to purchase such goods exempt from such tax.

ARTICLE XIII
1. The United States armed forces shall not be subject to taxes or similar
charges on property held, used or transferred by such forces in Japan.
2. Members of the United States armed forces, the civilian component, and
their dependents shall not be liable to pay any Japanese taxes to the Govern-
ment of Japan or to any other taxing agency in Japan on income received as a
result of their service with or employment by the United States armed forces, or
by the organizations provided for in Article XV. The provisions of this Article do
not exempt such persons from payment of Japanese taxes on income derived from
Japanese sources, nor do they exempt United States citizens who for United
States income tax purposes claim Japanese residence from payment of Japanese
taxes on income. Periods during which such persons are in Japan solely by
reason of being members of the United States armed forces, the civilian compo-
nent, or their dependents shall not be considered as periods of residence or domi-
cile in Japan for the purpose of Japanese taxation.
3. Members of the United States armed forces, the civilian component, and
their dependents shall be exempt from taxation in Japan on the holding, use,
transfer inter se, or transfer by death of movable property. tangible or intangi-
ble, the presence of which in Japan is due solely to the temporary presence of
these persons in Japan, provided that such exemption shall not apply to prop-
erty held for the purpose of investment or the conduct of business in Japa
or to any intangible property registered in Japan There is no obligation under
this Article to grant exemption from taxes payable in respect of the use of roads
by private vehicles.
ARTICLE XIV
1. Persons, including corporations organized under the laws of the United
States, and their employees who are ordinarily resident in the United tates
and whose presence in Japan is solely for the purpose of executing contracts
with the United States for the benefit of the United States armed forces, and
who are designated by the Government of the United States in accordance with
the provisions of paragraph 2 below, shall except as provided in this Article,
be subject to the laws and regulations of Japan.
2. The designation referred to in paragraph above shall be made upon con-
sultation with the Government of Japan and shall be resticted to cases where
open competitive bidding is not practicable due to security considerations,to
the technical qualifications of the contractors involved, or to the unavailability






51


27

of materials or services required by United States standards, or to limitations
of United States law.
The designation shall be withdrawn by the Government of the United States:

armfed forces;
(b) upon proof that such persons are engaged in business activities in Japan
. other than thosepertaining to the United States armed forces; or
() when such persons are engagedin practices irllegal in Japan.
3. Upon certiication by appropriate United States authorities as to their
identity, uch persons and their employees shall be accorded the following

Sbenefts of this Agreement:
(a) Rights of accession and movement, as provided for in Article V, para-
(b) Entry into Japan in accordance with the provisions of Article IX;
(e) The exemption fromcustoms duties, and other such charges provided for
in Article I, paragraph 3, for members of the United States armed forces, the
civilian component, and their dependents;
(d) If authoried by the Government of the United States, the right to use
the services of the organizations provided for in Article XV;
(e) Those provided for in rticle XX, paragraph 2, for members of the
armed forces of the United States, the civilian compsonent, and their dependents;
(f) If authorized by the Government of the United States, the right to use
military payment certiates, as provided for in Arteile XX;
(g) The use of postal facilities provided for in Article XXI;
(h) Exemption from the laws and regulations of Japan with respect to terms
and conditions of employment
4. Such persons and their. employees shall be so described in their passports
and their ariival, departure and their residence while in Japan shall from
time to time be notified by the United States armed forces to the Japanese
authorities.
5. Upon certication by an authorized oicer of the United States armed
forces, depreciable. assets, except houses, held, used, or transferred, by such per-
sons and their employees exclusively. for the execution of contracts referred to in

6. Upon certiation by an authorized oficer of the United States armed
forces, such personsand their employees shall be exempt from taxation in Japan
on the holding, use, transfer by death, or transfer to persons or agencies entitled
to tax-exemptionunder this Agreement, of movable property, tangible or intangi-
ble, the presence of which in Japan is due solely to the temporary presence of
these persons in Japan, provided that such exemption shall not apply to property
held for the purpose of investment or the conduct of -other business in Japan or
to any intangible property registered in Japan. There is.no obligation under this
Article to grant exemption from, taxes payable in respect of the use of roads by
T. The persons and their employees rr red to in paragraph 1 shall not be
liable to pay income or corporation taxes to the Government of Japan or to any
other taxing agency in Japan on any income derived under a contract made in
the United States with the Governmentof the United States in connection with the
construction, maintenance or operation of any of the facilities or areas covered
by this Agreement. The provisions of this paragraph do not exempt such persons
from payment of income or corporation taxes on income derived from Japanese
sources, nor do they exempt such persons and their employees who, for United
States income tax purposes, claim Japanese residence, from payment of Japanese
taxes on income. Periods during which such persons are in Japan solely in con-
nection with the execution of a contract with the Government of the United

purposes of such taxation.
8. Japanese authorities shall have the primary right to exercise jurisdiction
over the persons and their employees referred to in paragraph 1 of this Article






52





ARTICLE XV
1. (a) Navy exchanges, post exchanges, meses, socia clubs, teters, nes-
papers and other non-appropriated fund rganzations authorized and rgulaed
by the United States military authorities may be establised in the facilitis and
areas in use by the United States armed forces for the use of memers such
forces, the civilian coponent, and their dependents. Except as otherwise pro-
vided in this Agreement, such organizations shall not be subject to Japane r -
lations, license, fees, taxes or similar controls.
(b) When a newspaper authorized and regulated by the United States military
authorities is sold to the general public, it shall be subject to Japanese regula-
tions, license, fees, taxes or similar controls so far as such circulation is
concerned.
2. No Japanese tax shall be imposed on sales of merchandise and services
such organizations, except as provided in paragraph 1(b), but purchases within
Japan of merchandise and supplies by such organizations sha be subject to
Japanese taxes.
3. Except as such disposal may be authorized by the United States and Japa-
nese authorities in accordance with mutually agreed conditions, goods which
are sold by such organizations shall not be disposed of in Japan to prons not
authorized to make purchases from such organizations.
4. The organizations referred to in this Article shall provide h information
to the Japanese authorities as is, required by Japanese tax legislation.

ARTICLE XVI
It is the duty of members of the United States armed forces, the civilian com-
ponent, and their dependents to respect the law of Japan and to abstain from
any activity inconsistent with the spirit of this Agreement, and in particular,
from any political activity in Japan.

ARTICLE XVII
1. Subject to the provisions of this Article,
(a) the military authorities of the United States shall have the right to exer-
cise within Japan all criminal and disciplinary jurisdiction conferred on them
by the law of the United States over all persons subject to the military law of
the United States;
(b) the authorities of Japan shall have jurisdiction over the members of the
United States armed forces, the civilian component, and their dependents with
respect to offenses committed within the territory of Japan and punishable by
the law of Japan.
2. (a) The military authorities of the United States shall have the right to
exercise exclusive jurisdiction over persons subject to the military law of the
United States with respect to offenses, including offenses relating to its security,
punishable by the law of the United States, but not by the law of Japan.
(b) The authorities of Japan shall have the right to exercisee exclusive juris-
diction over members of the United States armed forces, the civilian component,
and their dependents with respect to offenses, incluing offenses relating to the
security of Japan, punishable by its law but not by the law of the United States.
(c) For the purposes of this paragraph and of paragraph 3 of this Article a
security offense against a State shall include (i) treason against the State;
(ii) sabotage, espionage or violation of any law relating to official secrets of
that State, or secrets relating to the national defense of that State.
3. In cases where the right to exercise jurisdiction is concurrent the following
rules shall apply :
(a) The military authorities of the United States shall have the primary right
to exercise jurisdiction over members of the United States armed forces or the
civilian component in relation to: (i) offenses solely against the property or
security of the United States, or offenses solely against the person or property
of another member of the United States armed forces or the civilian compnnt
or of a dependent; (ii) offenses arising out of any act or omission done n the
performance of official duty.
(b) In the case of any other offense the authorities of Japan sha have the
primary right to exercise jurisdiction.






53


29

(e) If the State having the primary right decides not to exercise jurisdiction,
it shall notify the authorities of the other State as soon as practicable. The
authorities of the State having the primary right shall give sympathetic consid-
ation t a request from the authorities of the other State for a waiver of its
Sin cases w e that other State considers such waiver to be of particular
importance.
4. foregoing provisions of this Article shall not imply any right for the
y a orities of the United States to exercise jurisdiction over persons
who are nationals of or ordinarily resident in Japan, unless they are members of
the United States armed forces.
5. (a) The military authorities of the United States and the authorities of
pan shall assisteach other in the arrest of members of the United States
armed forces, the civilian component, or their dependents in the territory of
Japan and in handing them over to the authority which is to exercise jurisdic-
tion in accordace with the above pro.visions
(b) The authorities of Japan shall notify promptly the military authorities
of United States of the arrest of any member of the United States armed
forces ivilian component, or a dependent.
(e) The custody of an accused member of the United States armed forces or
the civilian component over whom Japan s to exercise jurisdiction shall, if he is
in the of the United States, remain with the United States until he is
6. (a) The military authorities of the United States and the authorities of
Japan shall assist each other in the carrying out of all necessary investigations
into off n and in the collection and production of evidence, including the
seizure and, in er cases, the nding over of objects connected with an
offense. The handing over of such objects may, however, be made subject to
their return within the time specified by the authority delivering them.
(b) The authorities of the United States and the authorities of Japan
shall notify each ther of the disposition of all cases in which there are con-
current rights to exercise jprisdiction.
7. (a) A death sentence shall not be carried out in Japan by the military
authorities of the United States if the legislation of Japan does not provide for
suh punism t in a similar case.
Sau rities of Japan give sympathetic consideration to a request
from the military aes of the United States for assistance in carrying
out a sentence of imprisonment pronounced by the military authorities of the
United States under the provisions of this Article within the territory of Japan.
8. Where an accused has been tried in accordance with the provisions of this
Article either by the military authorities of the United States or the authorities
oted, or has been convicted and is serving, or has
served, his sentence or has been pardoned, he may not be tried again for the same
othe ter of Japan by the authorities of the other State. How-
ever, nothing in this paragraph shall prevent the military authorities of the
trying a ber of its armed forces for any violation of rules
of discipline arising from an act ion which constituted an offense for
which he was tried by the authorities of Japan.
9. Whenever a me of United States armed forces, the civilian compo-
nent or a dependent s prosecuted under the jurisdiction of Japan he shall be

(a) to a prompt and speedy trial;
(b to be informed, in advance of trial, of the specific charge or charges made
against him; ;
(d) to have compulsory process for obtaining witnesses in his favor, if they
(e) to have legal representation of his own choice for his defense or to have
freeor assisted legal representation under the conditions prevailing for the time
(f) if he considers it necessary, to have the ervies of competent inter-
preter; and
(g) to communicate with a representative of the Government of the United

0. (a) Regularly constituted military 'units or formations of the United States






54


80

under Article II of this t. The military police of such forces may take
all appropriate easures t ensure the maintenance f order and ty th
such facilities and areas.
(b) Outside these facilities and areas, such military ce shall be employed
only subject to arrangements with the authorities of Japan and in liaison with
those authorities, and in so far as such employment is necessary to maintain
discipline and order among the members of the United State a ed forces.
11. In the event of hostilities to which the provisions of Article V f the ety
of Mutual Cooperation and Security apply, either the Government of the United
tates or the Government of Japan shall have the right, by givg sixty d
noticet to the other, to suspend the application of any of the provisions of this
Article. If this right is exercised, the Governments of the United States and
Japan shall immediate!y consult with a view to agreeing on suitable provisions
to replace the provisions suspended.
12. The provisions of this Article shall not apply to any offenses committed
before the entry into force of this Agreement Such cases shall be governed by
the provisions of Article XVII of the Administrative Agreement under Article
III of the Security Treaty between the United States of America and Japan, as
it existed at the relevant timer
ARTIC LE xvIn
1. Each Party waives all its claims against the other Party for damage to any
property owned by it and used by its land, sea or air defense services, if suc
damage-
(a) was caused by a member or an employee of the defense services of the
other Party in the performance of his official duties; or
(b) arose from the use of any vehicle, vessel or aircraft owned by the oter
Party and used by its defense services, provided either that the vehicle, vessel
or aircraft causing the damage was being used for official purposes, or that the
damage was caused to property being so used.
Claims for maritime salvage by one Party against the other Party shall be
waived, provided that the vessel or cargo salved was owned by a Party and being
used by its defense services for official purposes.
2. (a) In the case of damage caused or arising as stated in paragraph 1 to
other property owned by either Party and located in Japan, the issue of the
liability of the other Party shall be determined and the amount of damage shall
be a-sessed, unless the two Governments agree otherwise, by a sole arbitrator
selected in accordance with subparagraph (b) of this paragraph. The arbitrator
shall also decide any counter-claims rising out of the same incident.
(b) The arbitrator referred to in subparagraph (a) above shall be selected
by agreement between the two Governments from amongst the nationals of Japan
who hold or have held high judicial office.
(c) Any decision taken by the arbitrator shall be binding and conclusive u
the Parties.
(d) The amount of any compensation awarded by the arbitrator shall be
distributed in accordance with the provisions of paragraph 5(e) (i), (ii), and
(iii) of this Article.
(e) The compensation of the arbitrator shall be fixed by agreement between
the two Governments and shall together with the necessary expeTns incidental
to the performance of his duties, be defrayed in eonal proportions by them.
(f) Nevertheless. each Party waives its claim in any such case up to the
amount of 1,400 United States dollars or 504.000 yen. In the as of onderable
variation in the rate of exchange between these currencies the two Governments
shill irree on the appropriate adjustments of these amounts.
3. For the purposes of paragraphs 1 and 2 of this Article the expression
"owped by a Party" in the case of a vessel includes a vessel on bare boat charttr
to t 'at Party or reonisitioned by it on bare boat terms or eized by it in prize
(excernt to the extent that the risk of loss or liability is borne by some person
other than such Party).
4. Each Party waives al its claiihs against the other Party for injury or
doeth stl frcd by any member of its defense services while such member was
engafred ij the performance of his official duties.
5. Cnlims (other than contractual claims and those to which paragrahs 6 or
7 af this Article apply) arising out of fact, or omissions of members or emnloyees
of the United States armed fores done in the prformance of official duty, or






55




out of any other act, omission or occurrene for which the United States armed
forces are legally -responsible, and causing damage in Japan to third parties,
other than the Government of Japan, shall be dealt with by Japan in accordance




(|) a tn to ee o tagto
with the following provisions:
(a) Claims shall be fled, considered and settled or adjudicated in accordance
with the la s and regulations of Japan with respect to claims arising from the



Sa comp tribunal of Japan, or the fial adjudication by such a
tribunal denying paymet, shall be binding and conclusive upon the Parties.
(d) Ery claim paid by Japan shall be communicated to the appropriate
ited States authorities together with full rticulars and a proposed distribu-
tion in conformity with sub aragraphs (e) (i) and (ii) below. In default of a
reply within two months, the proposed distribution shall be regarded as accepted.
e) Te rre in satisfying claims pursuant to the preceding subpara-
graphs and paragraph 2 of this Article shall be distributed between the Parties
as follows:
(i) Where the United States alone is responsible, the amount awarded or ad-
dged shabe ted in the proportion of 25 percent chargeable to Japan
(i) the United States and Japan are responsible for the damage, the
amount awarded or adjudged shall be distributed equally between them. Where
theby the defense services of the United States or Japan
and it is not to attribute it specifically to one or both of those defense
services, the t awarded or adjudged shall be distributed equally between
the United States and Japan.
iii E year, a statement of the sums paid by Japa in the course of
the half-yearly period in respect of every case regarding which the proposed dis-
tribution on a percentage basis has been accepted, shall be sent to the appropriate
United States authorities, together with a request for reimbursement. Such reim-
bursement shall be made, in yen, within the shortest possible time.
(f) Members or employees of the United States armed forces, excluding those
employees who have only Japanese nationality, shall not be subject to any pro-
cee gs he enfoof any judg t given against them in Japan in a
Sfrom the performance of their official duties.
(g) Exce in so far as subpaa ph (e) of this paragraph applies to claims
covered by paragraph 2of his Article, te provisions of this paragraph shall not
St a cim aisin t o o i ti with the navigation or opera-

Caims aainst m rs or es of the United States armed forces
(except employees who are nationals of or ordinarily resident in Japan) arising
out of tortious acts or omissions in Japan not done in the performance of official
duty shall be dealt with in the fo!lowing manner:
(a) The authorities of Japan shall consider the claim and assess com-
tion the claimant in a r an jst manner, taking into account all
the circumstances of the case, including the conduct of the injured person,

(b) the report shall be delivered to the appropriate United States au-
thorities who shall then decide without delay hether they will offer an ex
gratia payment, and if so, of what amount.
(c) If an offer of ex gratia payment is made, and accepted by the claimant
in. fullsatisfaction of his claim, the United States authorities shall make the
payment themselves and inform the authorities of Japan of their decision
and of the sum paid.t
(d) Nothing in this paragraph shall affect the jurisdiction of the courts

satisfaction of the claim.

Article, except in so far as the United States armed forces are legally responsible.






56


32

8. If a dispute arises as to whethr a tortios act or mission of a or
an employee of the United States armed forces wa done in the performance of
official duty or as to whether the use of any vehicle of t United States ared
forces was unauthorized, the question shall be submitted to an arbitrator ap-
pointed in accordance with paragraph 2(b) of this Artice, whose decision on
this point shall be final and conclusive.
9. (a) The United States shall not claim immunity from the jurisdiction of
the courts of Japan for members or employees of the United States armed forces
in respect of the civil jurisdiction of the courts of Japan except to the extent
provided in paragraph 5(f) of this Article.
(b) in case any private movable property, excluding that in use by the United
States armed forces, which is subject to compulsory execution under Japanese
law, is within the facilities and areas in use by the United States armed forces,
the United States authorities shall, upon the request of Japanese courts, possess
and turn over such property to the Japanese authorities.
(c) The authorities of the United States and Japan shall cooperate in the
procurement of evidence for a fair hearing and disposal of claims under this
Article.
10. Disputes arising out of contracts concerning the procurement of materials,
supplies, equipment. services and labor by or for the United States armed forces,
which are not resolved by the parties to the contract concerned, may be sub-
mitted to the Joint Committee for conciliation, provided that the provisions of
this paragraph shall not prejudice any right which the parties to the contract
may have to file a civil suit.
11. The term "defense services" used in this Article is understood to mean for
Japan its Self-Defense Forces and for the United States its armed forces.
12. Paragraphs 2 and 5 of this Article shall apply only to claims arising inci-
dent to non-combat activities.
13. The provisions of this Article shall not apply to any claims which arose
before the entry into force of this Agreement. Such claims.shall be dealt with by
the proiVsions of Article XVIII of the Administrative Agreement under Article
III of the Security Treaty between the United States of America and Japan.

ARTICLE XIX
1. Members of the United States armed forces, the civilian component, and
their dependents, shall be subject to the foreign exchange controls of the Gov-
ernment of Japan.
2. The preceding paragraph shall not be construed to preclude the transmission
into or outside of Japan of United States dollars or dollar instruments repre-
senting the official funds of the United States or realized as a result of service
or employment in connection with this Agreement by members of the United
States armed forces and the civilian component, or realized by such persons and
their dependents from sources outside of Japan.
3. The United States authorities shall take suitable measures to preclude the
abuse of the privileges stipulated in the preceding paragraph or circumvention
of the Japanese foreign exchange controls.
ARTICLE XX
1. (a) United States military payment certificates denominated in dollars
may be used by persons authorized by the United States for internal transactions
within the facilities and areas in use by the United States armed forces. The
Government of the United States will take appropriate action to insure that
authorized personnel are prohibited from engaging in transactions involving
military payment certificates except as authorized by United States regulations.
The government of Japan will take necessary action to prohibit unauthorized
persons from engaging in transactions involving military payment certificates
and with the aid of United States authorities will undertake to apprehend and
punish any person or persons under its jurisdiction involved in the counterfeiting
or uttering of counterfeit military payment certificates.
(b) It is agreed that the United States authorities will apprehend and punish
members of the Uniteed States armed forces, the civilian component, or their
dependents, who tender military payment certificates to uauthorized persons
and that no obligation will b due to such unauthorized ersons or to the Govern-






57


33

ment of Japan or its agencies from the United States or any of its agencies as a
resut of any unauthorized use of military payment certificates within Japan.
2. In order to exercise control of military payment certificates the United
States may designate certain American financial institutions to maintain and
operate, under United States supervision, facilities for the use of persons author-
ed by the United States t use military payment certificates. Institutions au-
thoried to maintain military banking facilities will establish and maintain such
facilities physically separated from their Japanese commercial banking business,
with personnel whose sole duty is to maintain and operate such facilities. Such
facilities shall be permitted to maintain United States currency bank accounts
and to perform all financial transactions in connection therewith including receipt
and remission of funds to the extent provided by Article XIX, paragraph 2, of
this Agreement.
ARTICLE XXI
The United States may establish and operate, within the facilities and areas
in use by the United States armed forces, United States military post offices
for the use of members of the United States armed forces, the civilian com-
ponent, and their dependents, for the transmission of mail between United
States military post offices in Japan and between such military post offices and
other United States post offices.
ARTICLE XXII
The United States may enroll and train eligible United States citizens resid-
ing in Japan, who apply for such enrollment, in the reserve organizations of
the armed forces of the United States.

ARTICLE XXIII
The United States and Japan will cooperate in taking such steps s a may from
time to time be necessary to ensure the security of the United States armed
forces, the members thereof, the civilian component, their dependents, and their
property. The Government of Japan agrees to seek such legislation and to take
such other action as may be necessary to ensure the adequate security and pro-
tection within its territory of installations, equipment, property, records and
oficial information of the United States, and for the punishment of offenders
under the applicable laws of Japan.

ARTICLE XXIV
1. It is agreed that the United States will bear for the duration of this Agree-
ment without cost to Japan all expenditures incident to the maintenance of
the United States armed forces in Japan except those to be borne by Japan
as provided in Articles II and III.
2. It is agreed that Japan will furnish for the duration of this Agreement
without cost to the United States and make compensation where appropriate
to the owners and suppliers thereof all facilities and areas and rights of way,
including facilities and areas jointly used such as those at airfields and ports,
as provided in Articles II and III.
3. It is agreed that arrangements will be effected between the Governments
of the United States and Japan for accounting applicable to financial transac-
tions arising out of this Agreement.
ARTICLE XXV
1. A Joint Committee shall be established as the means for consultation be-
tween the Government of the United States and the Government of Japan on
all matters requiring mutual consultation regarding the implementation of this
Agreement. In particular, the Joint Committee all sa erve as the means for
consultation in determining the facilities and areas in Japan which are required
for the use of the United States in carrying out the purposes of the Treaty
of Mutual Cooperation and Security.
2. The Joint Committee shall be composed of a representative of the Govern-
ment of the United States -and a representative of the Government of Japan,
each of whom shall have one or more deputies and a staff. The Joint Committee






58



24

shall determines its own procedures, and arrane for such auxiliary rga and
administrative services as may be required. The Joint Committee shall be so
organized tat it may meet immediately at any time at the request of the repre-
sentative of either the Governuent of the United States or the Government of
Japan.
3. If the Joint Commnittee is unable to resolve any matter, it shall reer that
matter to the resjctive Governments for further consideration through apro-
priate channels. "
ARTICLE XXVI
1. This Agreement shall be approved by the United States and Japa in ord-
aice with their legal procedures, and notes indicating such approval shall be
exchanged.
2. After the procedure set forth in the preceding paragraph has been followed,
this Agreement will enter into force on the 'date of coming into force of the
Treaty of Mutual Cooperation and Security, at which time the Administrative
Agreement under Article III of the .Security Treaty between the United States
of America and Japan, signed at Tokyo on February 28, 1952, as amended, shall
expire.
3. The Government of each Party to this Agreement undertakes to seek from
its legislature necessary budgetary and legislative action with respect to pro-
visions of this Agreement which require such action for their execution.

ARTICLE XXVII
Either Government may at any time request the revision of any Article of this
Agreement. in which case the two Governments shall enter into negotiation
through appropriate channels.
ARTICLE XXVIII
This Agreement, and agreed revision thereof, shall remain in force while the
Treaty of Mutual Cooperation and Security remains in force unless earlier termi-
nated by agreement between the two Governments.
In witness whereof the undersigned Plenipotentiaries have signed this Agree-
ment.
Done at Washington, in duplicate, in the English and Japanese languages, both
texts equally authentic, this 19th day of January, 1960.
For the United States of America:
CHRISTIAN A. HERTER,
DOUGLAS MACARTHUR 2ND,
J. GRAHAM PARSONS.
For Japan:
NOBUSUKE KISHi,
AITCHIr o FUJIYAMA,
MITSUJIRO ISHI.
TADASHI ADACHI,
KOICHIRO ASAKAI.
AGREED MINUTES TO THE AGREEMENT UNDER ARTICLE VI OF THE TREATY OF MU TUAL
COOPERATION AND SECURITY BETWEEN THE UNITED STATES OF AMERICA AND JAPAN,
PEGARDING FACILITIES AND AREAS AND THE STATUS OF UNITED STATES ARMED
FORCES IN JAPAN
The Plenipotentiaries of the United States of America and Japan wish to record
the following understanding which they have reached during the negoitations for
the Agreement under Article VI of the Treaty of Mutual Cooperation and Secu-
rity between the United States of America and Japan, Regarding Facilities and
Areas and the Status of United States Armed Forces in Japan, signed today:

ARTICLE III
The measures that may be taken by the United States under paragraph 1 shall,
to the extent necessary to accomplish the purposes of this Agreement, include,
intr alia, the following:
1. To construct (including dredging and filling), operate, maintain, utilize,
occupy, garrison and control the facilities and areas;









35

Toeor structures, make alterations, attach fixtures, or
Sto truct any additional buildigs or str uctures
together with auxiliary facilities;
To iprove anddeepen the harbors, channels, entrances and anchorages,
or maintain ary roads and bridges affording access to

4 To co (in ding measures to prohibit) in so far as may be required by
military necssity for the efficient operation and safety of the facilities and
areas anchorages, moorings, landings, taeoffs and operation of ships and water-
borne craft, aircraft and other vehicles on water, in the air or on and comprising,
or in the vicinity of, the facilities and areas;
5. To construct on rights of way utilized by the United States such wire and
Scatio facilities, inluing rine a subterranean cables,
pipe linesand spur tracks rairoads, as may be required for military pur-
poses; and
6. To struct, install, maintain and employ in any facility or area any type
Sinsllatio, weapon, substance, device, vessel or vehicle on or under the
groud, i te air or on or under the water that may be requisite or appropriate
including .eterological systems, aerial and water navigation lights, radio and
radar apparatus ad eletroni'devices. .
SARTICLE V
1. "nited States and foreign vessels .. operated by, for, or under the control
of the United S s or ofilcial purposes" mean United States public vessels and
rtereessels (bre boat charter, voyage charter and time charter). Space
charter is not included. Commercial cargo and private passengers are carried
by them. only in exceptional cases.
2. The Japanese ports mentioned herein will ordinarily mean "open ports."
3. The exemption from making "appropriate notification" will be applicable only
to ceptional cases where, such is required for security of the United States
armed forces or similar reasons.
laws an egulaon f Japan will be applicable excepts as specifically
provided otherwise in this Article.
ARTICLE VII
The probe of telecomunications rates applicable to the United States armed
flto be studied in the light of, inter alia, the statements concern-
ing Article V r d in the official minutes of the Tenth Joint Meeting for
the Negotiation of the Administrative Agreement signed on February 28, 1952,
whi are hereby incorporated by reference.

ARTICLE IX
The Germet If Japan will be ntfied at regular intervals, in accordance
Sp t b bet the two Gov e ents, of numbers and cate-

ARTICLE XI
1. The quantity of goods imported under paragraph 2 by the organizations
provided for in Article XV for the use of th members of the Untied States armed
forces, the civilian component, and their dependents shall be limited to the extent

2. Paragraph 3(a) does not require concurrent shipment of goods with travel of
owner nor does it requie single loading or shipment
The term military cargo" s used in patagrph 5(c) is not confied to arms
and equipment but refers to all cargo shipped to the United States armed forces
United States Government bill of lad term "military cargo" being
cargo to the Uted tates armed forces from cargo
shipped to otheir agencies of 'the United States Government.
4. The United Statesarmed fores ill take every pra cticable measure to ensure
that goods will not be imported into Japan b t









36

which would be in violation of Japanese customs laws and regulations. The
United States armed forces will promptly notify the Japanese customs authorities
whenever the entry of such goods is disc d.
5. The Japanese customs authorities may, if they consider that there has been
an abuse or infringement in connection with the entry of goods under Article ,
forces or
6. The word "The United States a fores
their power etc." in paragraph 9 (b) and (c) ref to r on a i
measures by the United States armed forces.


The United States armed frces will furnish theJapanese authorities th
appropriate information as far in advance as practicable on an ted
changes in their procurement program in Japan.
2. The problem of a satisfactory settlement of d to pro-
curement contracts arising out of differences between ted States and
nese economic laws and business practices will be studied by the J
tee or other appropriate persons.
3. The procedures for securing exemptions from taxation on purh of
goods for ultimate use by the United States armed forces will be as follows:
a. Upon appropriate certification by the United States armed forces that ma-
terials, supplies and equipment consigned to or destined for suchforces, are to
be used, or wholly or partially used up, under the supervision of such forces, ex-
clusively in the execution of contracts for the construction, maintenance or oper
ation of the facilities and areas referred to in Article II or or he support of the
forces therein, or are ultimately to be incorporated into articles or faciltes used
by such forces, an authorized representative of such forces shall take delivery
of such materials, supplies and equipment directly from manufacturers thereof
In such circumstances the collection of commodity and gasoline be
held in abeyance.
b. The receipt of such materials, supplies and equipment n the and
areas shall be confirmed by an authorized officer of the United Sta armed
forces to the Japanese authorities.
c. Collection of commodity and gasoline taxes shall be held in abeyance until
(1) The United States armed forces confirm and certify the quantity or degree
of consumption of the above referred to materials, supplies and eqt or
(2) The United States armed forces confirm and certify the amount of the
referred to materials, supplies, and equipment which hav been inco nto
articles or facilities used by United States armed forces.
d. Materials, supplies, and equipment certified under c(1) or (2) shall be ex-
empt from commodity and gasoline taxes insofar as the price thereof is paid
out of United States Government appropriations or out of funds contributed by
the Japanese Government for disbursement by the United States.
4. The Government of the United States shall ensure that the Government of
Japan is reimbursed for costs incurred under relevant contracts betweenappro-
priate authorities of the Government of Japan and the organizati provided
for in Article XV in connection with the employment of workers to be provided
for such organizations.
5. It is understood that the term "the legislation of Japan" mentioned in para-
graph 5, article XII includes decisions of the courts and the Labor Relations Com-
missions of Japan, subject to the provisions of paragraph 6, Article XII.
6. It is understood that the provisions of Article XII, paragraph 6 shall ap
only to discharges for security reasons including disturbing the main of
military discipline within the facilities and areas used by the United States armed
forces.
7. It is understood that the organizations referred to in Article XV will be
subject to the procedures of paragraph 6 on the basis of mutual agreement be
tween the appropriate authorities.
ARTIOLE xMII
With respect to Article XIII, paragraph 2 and Article XIV, paragraph 7, n-
come payable in Japan as a sultof service with or emt by the





I 1 1



87

Statesarmd forces or by the organizations provided for in Article XV, or under





personnel of the United States Gverment ordinarily accorded such privileges
abroad.
ARTICLE XVII
Re paragraph 1(a) and paragraph 2(a):
The scope of persons subject to the military laws of the United -States shall
be communicated, throughthe Joint Committee, to the Government of Japan by
the Government of the United States."
Re paragraph 2|(c) :
"Both Governments shall inform each other of the details of all the security

fenses in the existing laws of their respective countries."
Re paragraph 3(a) ii) :
"Where a member of the United States armed forces or the civilian component
is charged with an ofense, a certificate issued by or on behalf of his commanding
oficer stating that the alleged offense, if committed by him, arose out of an act
or omission done in the performance of official duty, shall, in any judicial pro-
ceedings, be sufficient evidence of the fact unless the contrary is proved.
The above statement shall not be interpreted to prejudice in any way Article
38 of the Japanese Code of Criminal Procedure."

R"1. utual procur relating to waivers of the primary right to exercise
jurisdiction shall be determined by the Joint Committee.
"2. Trials of cases in which the Japanese authorities have waived the primary
right to exercise jurisdiction, and trials of cases involving offenses described in
paragraph 3(a) (ii) committed against the State or nationals of Japan shall be
held promptly in Japan within a reasonable distance from the places where the
ofenses are alleged to have taken place unless other arrangements are mutually
agreed upon. Representatives of the Japanese authorities may be present at such
trials."
Re paragraph 4:
"Dual nationals, United States and Japanese, who are subject to the military
law of the United States and are brought to Japan by the United States shall
not be considered as nationals of Japan, but shall be considered as United States
nationals for the purposes of this paragraph."
Re paragraph 5:
In case the Japanese authorities have arrested an offender who is a member
of the United States armed forces, the civilian component, or a dependent subject
to the military law of the United States with respect to a case over which Japan
has the primary right to exercise jurisdiction, the Japanese authorities will,
unless they deem that there is adequate cause and necessity to retain such
offender, release him to the custody of the United States military authorities
provided that he shall, on request, be made available to the Japanese authorities,
if such be the condition of his release. The United States authorities shall, on
request, transfer his custody to the Japanese authorities at the time he is
indicted by the latter.
"2. The United States military authorities shall promptly notify the Japanese
authorities of the arrest of any member of the United States armed forces, the
civilian component or a dependent in any case in which Japan has the primary
right to exercise jurisdiction."
Re paragraph 9:
"1. The rights enumerated in items (a) through (e) of this paragraph are
guaranteed to all persons on trial in Japanese courts by the provisions of the
Japanese Constitution. In addition to these rights, a member of the United
States armed forces, the civilian component or a dependent who is prosecuted
under the jurisdicition of Japan shall have such other rights as are guaranteed
under the laws of Japan to all persons on trial in Japanese courts. Such addi-






62


38

tional rights include the following which
Constitution:
"(a) He shall not be arrested or de edwitut bi at one id of
the charge against him or without the immediate privilege of
he e detained without adequate cause; and upon demand of any person such
cause must be immediately shown in open court in his ence and the
of his counsel;
"(bh) He shall enjoy the right to a public trial by an mpartial tribunal;
"(c) He shall not be compelled to testify against himself;
"(d) He shall be permitted full opportunity to examine all witnesses;
(e) No cruel punishments shall be imposed upon him.
"2. The United States authorities shall have the right upon request to have
access at any time to members of the United States armed forces, the civilian
component, or their depede dents who are confined or detained under Japan
authority.
"3. Nothing in the provisions of paragraph 9(g) concerning the presence of a
rreresentative of the United States Government at the trial of a member of t
United States armed forces, the civilian component or a dependent prosecuted
under the jurisdiction of Japan, shall be so construed as to prejudice the provi-
sions of the Japanese Constitution with respect to public trials."
Re paragraphs 10 (a) and 10 (b) :
"1. The United States military authorities will normally e all arrests
within facilities and areas in use by and guarded under the authority of the
United States armed forces. This shall not preclude the Japanese authorities
from making arrests within facilities and areas in cases where the competent
authorities of the United States armed forces have given consent, or in cases of
pursuit of a flagrant offender who has committed a serious crime.
Where persons whose arrest is desired by the Japanese authorities and who
are not subject to the jurisdiction of the United States armed forces are within
facilities and areas in use by the United States armed forces, the United States
military authorities will undertake, upon request, to arrest such persons. All
persons arrested by the United States military authorities, who are not sub-
ject to the jurisdiction of the United States armed forces, shall immediately
be turned over to the Japanese authorities.
"The United States military authorities may, under due process of law, arrest
in the vicinity of a facility or area any person in the commission or attempted
commission of an offense against the security of that facility or area. Any sch
person not subject to the jurisdiction of the United States armed forces shall be
immediately turned over to the Japanese authorities.
"2. The Japanese authorities will normally not exercise the ight of search,
seizure, or inspection with respect to any persons or property within facilities
and areas in use by and guarded under the authority of the United States armed
forces or with respect to property of the United States armed forces wherever
situated, except in cases where the competent authorities of the United States
armed forces consent to such search, seizure, or inspection by the Japanese
authorities of such persons or property.
"Where search, seizure, or inspection with respect to persons or property
within facilities and areas in use by the United States armed forces or with
respect to property, of the United States armed forces in Japan is desired by
the Japanese authorities, the United States military authorities will undertake,
upon request, to make such search, seizure, or inspection. In the event .of a
judgment concerning such property, except property owned or utilized by the
United States Government or its instrumentalities, the United States willtrn
over such property to the Japanese authorities for disposition in accordance
with the judgment."
ARTICLE XIX
Payment in Japan by the United States armed forces and by those orgniza-
tions provided in Article XV to persons other than members of the United ates
armed forces, civilian component, their dependents'and those persons referred
to in Article XIV shall be effected in accordance with the Japanese Foregn
Exchange Control Law and regulations. In these transactions the basic rate of
exchange shall be used.
ARTICLE XXI
United States military post offices may be used by other officers and personnel
of the United States Government ordinarily accorded such privileges abroad.






63



39

ARTICLE XXIV
It is understood that nothig n this Agreement shall prevent the United States
from utilizing, for the defrayment of expenses which are to be borne by the
United States under this Agreement, dollar or yen funds lawfully acquired by
the United States.
WASHINGTON, Janury 19, 1960.
C. A. H..
N. K
DEPARTMENT OF STATE,
Washington, January 19, 1960.
His Excellency NOBUsuKE Kisui,
Prime Minister of Japan.
EX LNC I have the honor to refer to paragraph 6(d) of Article XII of
the Agreement under Article VI of the Treaty of Mutual Cooperation and Secu-
rity betwee the United States of America and Japan, Regarding Facilities and
Areas d the Status of United States Armed Forces in Japan, signed today. The
second sentence of the said paragraph provides that "in such case the Govern-
et of the United States shall pay to the Government of Japan an amount equal
to the cost of employment of the worker for a period of time to be agreed between
the two Governments."
I wish to propose on behalf of the Government of the United States that the
period of t mentioned above shall not exceed one year after the notification
provided for in paragraph 6(b) of Article XII of the above-cited Agreement, and
be determined in the consultations under paragraph 6(c) of Article XII
above on the basis of mutually agreeable criteria.
If the made heein is acceptable t the Government of Japan, this
Note and Your Ecellency's reply to that ect shall be considered as constituting
an agreement between the two Governments.
Acct, E, te r d assurances of my highest consideration.
CHRISTIAN A. HERTER,
retary of State of the United States of America.

WASHINGTON, Janiary 19, 1960.
His Excellency CHRISTIAN A. H TR,
S erearyof tate of te U d tates of America.
I have the honour to acknowledge the receipt of Your Excellency's
Note of today's date, which reads as follows:
"I vethe hoor torefer topar ph (d) of Article XIof the Agreement
under Article VI of the Treaty of Mutual Cooperaton and Security between the
United States of America and Japan, Regarding Facilities and Areas and the
Status of United States Armed Forces in Japan, signed today. The second sen-
tenceofthe said paragraph provides that 'in such case the Government of the
itoof Jaa an amount equal to the cost
for a period time to be agreed between the two
"I wiof the of the United Stte th tathe
exceed one year after the notification
or i pah b)of Article XII of the above-cited Agreement
and may be determined in the consultations under paragraph 6(c) of Article XII

"If the proposal made herein is acceptable to the Government of Japan, this
to t effect shall be considered as constituting
an agreement between the two Governments."
I have the honour to inform Your Excellency that the Government of Japan
accepts the above proposal of the Government of the United States, and to con-
firm that your Note and.this reply are considered as constituting an agreement

I avail myself of this opportunity to renew to Your Excellency the assurances
of my highest consideration.
NOxBUSUKE K sHI.



























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"DEFENSE OF JAPAN"'

Defene White Ppma June 197
(Published by the Japanese Defense Agency)
apins internal and external environments have undergone far-reaching'
changes since 1970 when the last Defens White Paper was published. The cur-
rent hite Paper is designed partly to clarify the background against which
the so-called "post Fourth Defense Buildup Plan" is being programmed, and
priarly to give wider se t of the public an understanding of the realities
of the interatinal environment, the basic concepts of our national defense and
some facts about the self-defense forces. The Paper consists of four chapters:
Chapter I: Trends of the Inrnationa tuaion. Chapter : Defense Policies
of Japan. Chapter III: The Public and Self-Defense Forces. Chapter IV: SDF
and Their Major Activities.
S I, thtionl situation is analyzed in terms of its relatively
long range trends and with emphasis on the factors relevant to the concept of
our national defnse policies. The chapter also outlines the general implications
and the respetive roles of the collective security system and military power in
the nuclear age; it also elaborates factual data on the military presence around
Readers will find n Chapter explanations of our basic defense policies,
including the concept of a basic standing force which can be characterized as a

Chapter III is devoted to ivilian control and other related issues indispens-
able for understanding the fact that the seldefense forces are people's arms
and their effectiveness depends on mutual trust.
S s information on the forces, their activities
and some of the problems inherent to their organization.
Chapter 1. Trends of the International Situation


(a) The United States and the Soviet Union, fearing the consequences of

it s to their mutual interest to continue their dialogue on how to avoid crisis,
whatever their conflict of interet, and to adopt political and military measures
necessary for accommodation. Thus East-West dialogue has continued in Europe
where mpressive military, forces, including those of the two superpowers,

involved.
* Rndp have been controlled

i' I' a; :1 . *
nd of this trend exists a military equilibrium based on
ear bee the United States and the Soviet Union or
be W Alo ctib g to this trend is the
commonrecognitionthatnationsincreasingly have to turn their ee to their
own problems, that military expenditures would become too heavy to bear if
they should increase as tension remains and grows, and that many global prob-
lems are beyond resolution by military means only, In Asia, the Sino-United
States rapprochement became to some extent a regional stabilizing factor; but
the region is far from stable because of its multiplicity which has no parallel

(c) On the other hand, the world has faced a series of wide-ranging problems--

in particular, food. oil and other resources have become serious issues which


(41)

I4 AK 41, (






66



42

directly relevant to national security. As a result, the growing need for inter-
national interdependence cannot a favorable impact on East-West
relations.
(d) However, the Un Stat and he iet hide the mutual
distrust that lies underneath their detente; in fact, critica vces are constantly
raised in their respective domestic scene a st c and compromises
related to detente. The United States nteprts dente as averns,
with limitations, the relations between superpwers who
state of confrontation. The United States, therefore, seeks a more stilize
international order by, on one hand, maintaining suicient mlitary power neces-
sary for a military equilibrium and, on the other, continuing her dialogue with
Moscow. As for the Soviet Union, peaceful tee is desi to avoid
with nations with different social systems. Her policy, however, never rules out
all types of struggles, eiher national liberation or idological.
(e) All this inevitably reveals the limit of d1tente. Its primary objective is
nothing but the avoidance of an intercontinetal nuclear war as well s conven-
tional armed conflict that might escalate to such a war,. ence d6tente doe not
keep big powers from staging political struggles for expanding influence or for
preventing it. Neither does detente itself prevent military conflict In the areas
where big powers have only limited strategic interest, as evident i the case f
Angola.
(f) The emergence of China as a nuclear power has made international rela-
tions more complex than before and has contributed to the .mutipolarization of
world politics. Against the background of the Sino-Soviet dispute, China never
ceases to be defiant vis-a-vis her northern neighbor and always cha ges any
possible creation of a new international order under a Pax Russo-Americana.
(g) Thus the realities of the world today are far removed from peace: poers,
in the East and the West, build up their military capabilities while keeping their
mutual distrust under the carpet, and make politicl accommodation only to the
extent it is necessary. D6tente or reduction of tension basicallyi conotes both
coexistence and struggle between East and West. Consequently the international
community would have to live, for the foreseeable future, with the realities of a
continuous cycle of tension and relaxation. However inevitable the parallel pres-
ence of coexistence and struggle may be, if international relations are to turn
more stable, the world may continue to need international efforts to maximize
the coexistence relationship and to minimize the struggle factors through accel-
erated development of arms control and other measures.
B. Roles of collective security systems
(a) Direct, armed collision has so far been successfully deterred both between
the two nuclear superpowers and between collective security organizations, each
with a US or Soviet deterrent, including nuclear capabilities, integrted as hr
respective basic security factor. The rest of the world, however, has suffered
from countless military clashes since the end of World War II.
(b) The collective security system among nations had primarily been military
in Cold War days. As East-West confrontation was relaxed and interdependence
gained momentum, the system has become the base for a wider spectrum of
cooperative relations, not only military but also political and economic.
(c) This does not spell an end to conflict of interests or to confrontation
among nations. In the contemporary international community where the UN
peacekeeping function falls short of an effective means, collective security sys-
tens under regional arrangements still remaian appropriate option.
C. Contemporary implication of militaru power
(a) In the politico-military context outlined abve. a kind of stability exists
among the major nations today. To uphold this stability, however, the US and
the Soviet Union have to keep their nuclear capabilities invulnerable while
others maintain a military potential based on credible conventional arms. It
might sound paradoxical that a strong military power is essential for the mainte-
nance of peace; it might not be so, however, if one identifies military power th
the strength to deter war. This is the basic characteristic of military power in
the nuclear age.
(b) To avoid wars of any kind, a chain of nations should have no single feeble
link which might provoke a military challenge; only an international system
whose every link is strong and enduring can survive any tet it faces. An appro-
priate defense posture, coupled with diplomatic efforts, is the first step to
















t h maj' w wtr to.
trengthen the links of thechain of atio nd toaepeace strategy to viable

2. OJ
Such a defense posture depends, frst of all, on a collective security system based








on common will a mutul responsi y.m e te

Secondlyit implies that every member nation of the ystem mnn st-ave'ap'strong.
avoid a lear exchangeor ale military conflict; ths it i quine pos-t

sig antly lower leve dl ~ inti~st their heUrent siltars,' mght rether ent.
This explains why even a nonncwear omilitary power can be useeu fore the de-
fense of small and medium nations.reg








onal multility, cntrute to an er p nt inst~bili make the mat-
ter more complex, China and the Soviet Union almost annually step up their





ositie aroa s to t e atios te ord does the Sino oie
rivalry seem to be so overt and intensive..The. United States, on the other hand,
plays the role of a counter-weight to the communist rivalry by expres sing her
B. Northeast Asia is the area where the vital #trategle interestg of the United




States, the Soviet Union and China converge. It is also o of the areas where
a number of bilateral security systems functio eectively, more. or less. In
sharp contrast to'the European environment, the area is Inced with confronta-





of th ited States, the Soviet Union ad China.
C. On the other hand, the United States and the | fet Union maintayin in
this area frontal deployments of their armed forces, second in scale only to those
of the European front. China ad the viet Union have contributed since the
late 1960's to a continued military tension along their land border where troop
concentrations are obvious on both sides.e
D. he Soviet military has eploedin thisregin sizable military. orce
with a variety of combat capabilitieswihseems to have been substantiallY




yncapability.
F. The United States has gradually streamlined and reduced her Mili tary


G. In the Korean Peninsula, the confrontation continues between *the north


still remains a remote likelihood mainly due to the continued military equilib-
rium supported by the US military presence in Korea.
H. Military situation in Japan's periphery: Chart I and 2 show the general
trend of the military disposition around Japan and the deployment of forces in

Chapter 11. Defense Policies of Japan




4 k ll h. Mi B I S ^S ^ Bas i ^". g ^ *.^1. i^ -! s,' s *j't.i I 1' *









44

(b) With respect to alear principles will be
maintained and, against a nuclear threat, Japan will depend on the credibility
of the American nuclr deterrent. I Japan
a purely defensive purpose, her actual possession of nuclear arms will create
serious suspicion and fear on the part of
on this preise she shoud feel no need to go nuclear,
but also the political viewpoints.
(c) With this as the basic chaacteisti, J 's def ca ty ould
be ready to deal with a contingency by denying *othes easy armed sion.
This defense capability, together with the United States-Japan security system,
must form a defense posture that leaves no operational deficiency. And under this
system, the capability ust one which can function effectively in pre
an aggression before it is actuallylaunched.
(d) The implication of possessing uch a defense capability lies notso mu
in fighting a contingency as in functioning for the maintenance of peace. The
capability, coupled with the United States-Japan security system, substantiall
contributes to a stabl equilibrium of internatonl relations in Asia From t
point of view, our defense capability should be of a size appropriate for such an
implication and a contribution; it also must be of a nature that directly serves
the public in helping and cooperating with them in eacetime.
B. United States-Japan security systemn
(a) The system is generally understood to playthe ole of prevt r
sion against Japan from actually taking place, and of lmiting the scale of an
invasion, should it ever be undertaken ..
Ib) The system is also instrumental in providing the US forces with facii
and areas for their use, which in turn make- their presence tenable, An
part of the basic framework of international relations in Asia, the system thus
contributes tohe stability of the world and the maintenance of p e. Fially,
but not the least impbrta'fly, it.is theJl dispenalb lbasel of the wider spectrum
of friendlyy U~ited State sJapanese relations. .
2. THE CONCEPT OF BASIC STANDING FORCE
A.'Procedural backgrowi nd"
The concept has been adopted by. the Defense Agency in planning the follow-on
of the Fourth Five-Year Defense Buildup Program (fiscal year 1972-76). It is
expected to make the buildup program more concrete,, practical, rationale and
meaningful than it has ever been. In-other words, .the concept represents a for
of thinking fed into the policy-drafting process in the Agency, and hence will be
aninput into a further review as to its practicability before t will be submitted
to the Defensen Council for a.fnal decision.
I. Internationil entviro nient
The concept presupposes, a continued, effective maintenance of the United
States-Japan security system,, and in addition assumes: *
(a) that the United States and the Soviet Union will try to avoid an inter-
continental nuclear war and an armed conflict which might lead to their full-
scale involvement.
(b) that the Soviet Union will continue to face many European problems-a
NATO-Warsaw Pact confrontation and the control of East European nations,
among other matters.
(c) that Sino-Soviet relations, i improved partially, will most unlikely lead
to an end of confrontation,
cd) that in Sino-U.S. relations, a further adjustment will continue on a re-
ciproeal basis, and
(e) that the status quo, more or less, will be maintained in the Korean Pe-
ninsula where a minor incident would not escalate to a large-scale conflict.
Thki series of assumptions makes it almost unthinkable that a large-scale
military aggression mieht be launched against Japan but does not rule out the
possihility of a spin-off from an armed conflict in Japan's peripheral areas and
of other.small-scale military invasions.
C. Coneptual implicati8ons
(a) Against the background of the international environment assumed above,
our defense capability could be identified with a defense power in peacetime. Its






69





primary goal is not so much an ability to d a' specific, imminent threat as
Sf a itare a tyy nture
spells that:
(i) Every Integral. element of defense should have. no serious defciency so
that the capability as a whole would be suientto take. minimum, necessary
i) In terms of operational function, all the elements must be built p and
ied by taking into accountthe haracte of apa peculiar terrain
and efensive ree-
tion to an aggression, from itsvery tet, bould it breakot either Japan's
anebetween, a an organi integration of, combat and, logistic elements, if
they are to oerate as an eectivecomprehenve defense qwer against the
Siaggres h
(iii) -In peacetume,. the defense capability should, undertake meticulously
nned training nd education rthr to be.alays ready forrese-relief op-
eration in case of a large le natural disaster.the required.nits with necessary


(h) In terms of operational capability,'the basic standing fored must main'-
) For a qui ible respose to hanges n sittions, a higher priority
should be given to operational readiness of air and strait surveillin-as well as
other intelligence ameans than to other elements W 'the defense capability.








rfrf
(ii)- The basic standife force foust aintahn at oierational posture ready to


airhand oteer typenof ille ilithry ts.


in turn depends on the siciency of ma r "~d et thin a necessar

(iv) In pradn various force functions and equipment, it should be taken
into account that the United States-Japan security system would fncfibn effete-
tively* that in, turn meansthat siooth operational -coordi5atione with -the U.S.
forces wil-be-of critical.importance.: s



S(v) -The force must be a basis for smooth expano ad reinforcement to abe


pon hanges in the internationalsituat ter-
In s or defense capabilito beost described s the b nderin



for---as improvement, itnimumforce- om
domestic climate -m internationat entidn i eti. The nret t.'o' *eh iver, w ill be
nsnational sit ation.w cb a

A, major emphasis is plaed on qualitatie improvement rath er than -on quanti-
tative expansion in the planned -buildup of our defense capability ander the
concept of the basic standing force. By -qualitative improve nt, it is not. meant









making stage from the Diet, the cabinet, the Defense Council to the Defen.e
Volitico-administrative effort punblic, cnt-n 'As *ell as y Hie.'i











2. "CU *TO
70





2. "COMMITTEE TO THINK ABOUT DEFENE"
The 11-member committee was set up to give a conceptual Input of public
opinion into defense planning for the period that folows the Fourth Defense
Buildup Program. The members studied and scamong other things,the
need for Japan to possess her own defense cablity, the i cat of the
nited States-Japan security and its role. The views and suggestions
produced in the committee have contributed s
of the basic standing force.
3. PUBLIC UNDERSTANDING AND CONCERN
Public concern in defense affairs has gradually grown greater as evident in a
recent publ opinion poll which showed that 79 percent of the lled re iz
the need for having the self-defene forces. Close contacts are also deve
between the public in general and the men in the forces, while a minority of
people still maintains a negative attitude toward the forces, producing a d i
mental effect upon the morale of the men in service.
4. DEFENSE FACILITIES AND COMMUNITY
Flor an overall defense posture, it is critically important that a harmonious.
relationship should exist between defense facilities and the surrounding com-
munity. On one hand, the facilities must function effectively on the other, the
function should not disturb the community excessively. For tis purpose, a new
law was put into effect in 1974 for the improvement of the living environment
around defense facilities. The Agency has since taken positive steps to reduce-
the noise levels of aircraft and to prevent other forms of possible public nuisance.
5. RESCUE-RELIEF AND OTHER COMMUNITY ACTIVITIES
In addition to their inherent mission, the self-defense forces must contribute to
the stabilization of national life by making best use of their organization, equip-
ment and capabilities. They must have undertaken rescue-relief operations, dis-
posal of unexploded bombers and other community activities, including civil
engineering projects. The rescue-relief operations have increased both in -scope-
and. scale as illustrated in chart 3. An exercise has also been conducted in prep-
aration for a possible major earthquake.
Chapter IV, SDF and Their Major Activities
1. ORGANIZATION AND AUTHORIZED MANPOWER
2. OUTCOME OF THE FOURTH DBP
The five year buildup program for fiscal year 1972-76 is about to end with a
substantial proportion of the planned acquisition of major equipment left un-
accomplished, mainly due to extremely high procurement cost.
3. NEW UNITS AND NEW EQUIPMENT
Newly organized or commissioned units and equipment include the 1st Tank
Brigade, the 7th Antiaircraft Artillery Group, DDG Tachikaze equipped with
SAMs, submarine Takashio, and F4EJ squadron and a 0-1 Squadron, among
others.
4. SCRAMBLES
The Air Self-Defense Force is under alert around the clock against .possible
violations of Japan's territorial air, In September 1975, for instance, a Soviet
plane did violate the territorial air forcing the ASDF to scramble. Frequency of
scrambles stands at about 320 times a year (table 1).
5. RESTRICTED TRAINING AIR SPACE
Air space for ASDF training has been strictly restricted since 1971. This
creates considerable difficulty in the training programs of jet planes. A similar
difficulty exist, in finding maneuver grounds for the GSDF and training waters
for the MSDF.
6. UPGRADING OF EDUCATION
A Defense Medical College was set up to meet an acute sh of medical
officers while the Defense Academy hs adde4 a new faculty of Hmanites and
Social Science.






71



47

7. INTERNAL OPINION SURVEY
A recent survey conducted by the GSDF shows that 74 percent of the men feel
eir daily duties are worthwhile, t .ma list, as an ideal mode of living,
life with time for individual hobbies" and that many others call for more in-
tensive daily training.
8. NEW POLICIES FOR BSD PERSONNEL
A new system was initiated to recruit high school graduates of high caliber
and train them for r promotion to the gradethe Agency also improved
pay and accommodation for those living in barra and started in fiscal year
1974 to accept w en in th the MSDF and the ASDF.
9. R. & D. AND DOMESTIC PRODUCTION
Domestic arms production is a desirable option fo acquiring equipment that
s suitable for Japan's terrain and other speciic requirements as well
as aintaining a technological potential and streamlining logistic support.
However, tere can a case in which domestic technology and cost-effectiveness
coud be inferior to eq pmet purchased overseas. Procurement decisions have
thu been made on a case-by-case basis. Domestic arms production and R. & D.
ave to be undertaken in an extremely difficult condition, cost-wise and man-
power-wise. The problems that need further scrutiny include, therefore, a selec-
tion of items with predetermined priorities, strict evaluation and properly
planned home production.
10. DEFENSE EXPENDITURES: THEIR TRENDS
During the Fourth DBP, the defense-expenditure/appropriated-budget ratio
deceased annu ly as shw in Chart 4; the average increase of the expenditure
stands at 17.7 percent against 20.9 percent of the appropriated budget. On the
other hand, the manpower cost has risen while the proportion allocated to ma-
terial cost has dropped as shown in chart 5. The absolute amount of Japan's
-defense expenditure cai be ranked 10th in the world; but this is somewhat mis-
eaing since Japan belongs to a world group ranked at the bottom f the ex-
penditure is measured in relation to either GNP, per-capita income or the ap-
propriated budget.
FIG. 1-TREND OF FORCES AROUND JAPAN (APPROXIMATE)

Division Naval forces Air forces

1LS.S.R. in the Far East:
1965--------,- ----------------------------- 8 (17) 70 1,430
1970- ...........----...--.-..... ------.....----- 2. 22) 100 1,870
1975........................................--...... 30 .. --- 2 000
1965 ---...--...--....---...--..........-----------------------------................................ 225 115) 21 2,800
1970.. -.. ........-..-.....-.......- ......--..... 245 (118) 21 3,300
1975 ................---.....--------................................---- 280 142) 35 4400
'North Korea: 2 ( 5 0
1965 ...---- ..-------------------.-------. 33 (18) 1.5 500
1970.........................................-- .. .37 ( 2) 1.4 580
1975......................................................... 41 (24) 4.4 590
1965 ................................................... 57 (29) 5.7 ..............
1970 ..- __.----- -- ----.--_----------------------------- 60 (30) 7.0 200
1975.a.....-,--...-..,-........................... 58 (24) 7.8 220
.S. Forces in the Far a:
1965........................... .............. ............ 8.7 (3) 9. 920
1970 .......--------.....................-----......--------------....--.------------................ 9.6 (3) 110 740
1975----------------------...........................-------------------......................---.......- 6.6 ) 60 500
-Japan:
1965..---------..-..........----------.....................---------------------..... 15.2 (13) 11.2 720
197.............--.....-------................-----------------.....----------... 15.8 (13) 13.9 590
1975................. .................................... 15.5 (13) 16.8 610

1. The res for ground forces (10,000 persons) and air forces (combat aircraft) are quoted mainly from the Military
Balance published in the corresponding year.
2. figures for naval forces (10,000 tons) are quoted mainly from the Jane's Fighting Ships published in the corre-
-sponding year.
3 The figures for Chinese divisions do not include artillery, and railway construction engineer divisions.
4. Naval force of the U.S. forces in the Far East is the 7th Fleet Air forces include carner borne elements of the 7th
5. U.S. forces in the Far East are in Japan, the Republic of Korea, Taiwan, and Philippines.
6. The figures for Japan ieiate actual str-nah.










,0

















x x? () o _9 ,1 5.5 _
--mi' 2.0









Mari" Corps t ...


IU.S.i it R.O.K. 200

"1 4.2 (I div.)
--- 6 M aKore Corls 2.4











r'a i "ati LTi SU. i n
r 7 0.25


_.._ 4,21
I lPhi ,1 Il-:
l pi 4e 4220 220U.S.. i7h Jalee
Fl.1Navine Cior|ps 2 I I" 2.6
__U.S.V. in R.O.K. 200fV
r 4.2 (1 div.) -





a 5. 2 Ma ri ..e Corps 3.5rs





S50
U.S.P. in
Ta-.i vT aan



\ -.. so Idl..
Phii pipinII .N.Vi'. in e -
li. "hi' lp es -A M 220 The 7th Fleet

j 15 .2 I Y-JMaf i e Corps 1.5 TA 60
.. 0 55 150
I a (Carrier borne)

(Note) 1. Aircrafle' is "combat i rcraft" frunt Mii lt ry Bilainee, it
cotimpri es thuom;er, figlht.er-lnombLer strike, ii lercepter,
rectn.i=tissauice, etc.; it does not incl.de helicoplers.






73





FIG 2.-Deploment and.basing around Japan.


the munhler of cases persons (total)
S(10 thousands)
800 6(K0 40(1 -200 -2 4 6 8 0o .12
G I *' S IJ



E .' 1971 1; 7
19. 7 21



1973


1974 []
^_. ....... 1973 -
I 1 .. II











\: "' I 9 7 4






74



50

FIGuU 8.-Relief for disastered people.


te ren se Bwle .. ../(N 1'
(8- - ...... -

..7..
1.6.
I 5- i *



1.2 -
.A .



1.0. 0 * 0 0 0















9.00.
S.8 .., ... ,









34.0-- ) J: : ;




33.00 - i
' '" ""--- -
















9. 0. -




8,.00. 3. .
I








12.00 \
O 11.005-
\1










5 1960 1665 1970 1071 1972: 173 19'4 19- 5 1o 6






75



51

eftGuB 4.-Trend of defense budget.

J~proemet f C r Local Si Iuaion
A illjIn-i'L L IVaciliLia s wai Areas,















FY 1972 4'.6 24.9 14.7 7.6 ( 1.9




S2.6
I.l








2 14(24. .7 78.6 1.9
... ... .. L.4










197 456.5 15.4 14.5 .5 2.0
1.3
.......... .... .. ..........I- .... _... .. 2.6

M974 *'4 22.9 14.2 8t.8 19
--, II 1.0


!>w '.'. ?** 14.5 8.6 ' *


176 5(.0 *4 14.5 B.2 1,7


o 10 20 ) J 40 50 Ir 7 80 80 O Io (j )

IuLe) I. Ir i.urime Intlelles Vetonis s aull Vehirle s, Airc rfl. oind Shiips.
S' 2Operatiiion law MHtil.enance includes Livijng ctal, CloUling, PlFel,
Mahil' enance suil Repair.'


FIGUBE 5.-Change of composition of defense budget under the fourth 5-year
defense plan.
The number of times of scramble (Fiscal year 1970-74):
Fiscal year: Number of tiim
__1970__ a___- ....--... -----.--...----.--..--- 370
197 .....- ... ........ .... '...............----- 3045
M ------------------- ---------------------------------- -- 306.
197 -------------------------------------------------- ---------- 257
1974 ..----- ------------------------------ -...- 323.

Total ..........................-.............. 2 1, 601
erage-------- -~i--~, c l,---------------------------- 320
iiIl ill/ il/li l IllIl/l- IIl/iiI11
Xlii liX




























;,, ,
~~~ira~
~a l;ci r~ ";"..~.


~91

In ~ ~~ i I r,.l, i~HI~
~~. iI ;, ~~~l,i;r~~ 4;
""I~""

1111 1~1 n s

































































































Ir






















if C,













4. DATA ONCERNIG U.S. MILITARY PERSONNEL AND BASES IN
JAPAN

GaPH I

U.S. MLITARY POPULATION IN JAM .
S(I THOsANDS)
5
-" "4 1 i i' .i 'i


















Sore: Dept. of Defense.
I Ii I Ii
.. .... I-- ------'-. --t-- -


400 J- ; "' _1 .

























300 -- K ., .AWA
.... i lR E SSOS
I .-1 MIY 1972II.
50



5. 52$s 565 -58, 9 0 16 5 70-1 1 7 7r t
NoT -Rise on graph in 1972 reflects the U.S. bases on Okinawa which became
a part of the U.S. military community in Japan upon reversion.
Sour: Dept of Defense.











(400 8



15 MAY 1972
200 -



.0 I I I I '
1952 1955 1960 1965 1970 1975 lin

NoE.-Rse on graph in 1972 reflects the U.S. bases on Okinawa which became

Source: Dept. of Defense.

(53)

(77)





78

54




CIVI RVICE U.S. DEPENDENTS
U.S. MILITARY C I+C s
U.S. EMPL YES (MIL 8 CIV)

ARMY 4.4z 62
NAVY 6,60o-
:3,768 43,220
MARINES ..2.95 ,*-
AIR FOR CEQ |14,|s6


TOTAL as.7o
3/76

GRAND TOTAL ,7 ..........
Source: Dept. o Defene.


U3S OACES ASSIGM1NET

MARINES AIR FORCEI ARMY NAVY TOTAL
ASSIGNMENT-
23,915 14,756 1 4,462 6,607 49,740
100
75- .... . 64%

JAPAN 50- 4 22 I%
34%
AA25- 22% 31 ,.
25 3 '1*
a.:4 "" | | -|. I,, I:
0% -

25-
O/INA WA q35
5035
PREFECTURE 758% o
7575 66%
78%9


.Source: Dept. of Defense.









94th congesI z
d SessionPM








POSTWAR SOUTHEAST ASIA





A SEARCH FOR NEUTRALITY AND
INDEPENDENCE





A REPORT

F BY

SenatorMIKE MANSFEELD

Majority Leader, United States Senate


REPORT NUMBER TWO














Printed for the use of the Committee on Foreign Relations


U.S. GOVERNMENT PRINTING OFFICE

I III
WASHINGTON : 197
..';~~il 1 _-






80
























COMMITTEE ON FOREIGN RELATIONS
JOHN SPARKMAN, Alabama, Chairman
MIKE MANSFIELD, Montana CLIFFORD P. CASE, New Jersey
FRANK CHURCH, Idaho JACOB K. JAVITS, New York
STUART SYMINGTON, Missouri HUGH SCOTT, Pennsylvania
CLAIBORNE PELL, Rhode Island JAMES B. PEARSON, Kansas
GALE W. McGEE, Wyoming CHARLES H. PERCY, Illinois
GEORGE S. McGOVERN, South Dakota ROBERT P. GRIFFIN, Michigan
HUBERT H. HUMPHREY, Minnesota
DICK CLARK, Iowa
JOSEPH R. BIDEN, JR., Delaware
PAT M. HOLT, Chief of taf
ABTHUR M. KUHL, Chief Clerk
(II)





81


LETTER OF TRANSMITTAL

AUGUST 31, 1976.
Hon. JOHN SPARKMAN,
C irm a, Committee on Foreign Relations,
U.S. Senate, Washington, D.C.
DEAR MR. CHAIRMAN: With the Committee's permission, during
the August recess I made an official trip to Thailand, Burma and
Laos to study various aspects of United States relations with those
countries and regional developments which bear on American policy
questions. I also stopped in Hong Kong to obtain a briefing from the
staff of the American Consulate General concerning the current situa-
tion in the People's Republic of China and information about the
international traffic in narcotics. Enroute to and returning from
Southeast Asia, I also stopped briefly in Tokyo to receive up-to-date
reports on recent political developments in Japan.
I am hereby transmitting my report on the trip, in the form of a
speech I made in the Senate on August 26.
In Thailand I met with His Majesty King Phumiphon Adunyadet,
Prime Minister Seni Pramot, Foreign Minister Phichai Rattakun and
other officials of the foreign ministry. Ambassador Charles S. White-
house provided me with a thorough briefing.
From Bangkok, I flew in a small airplane, attached to the U.S.
Embassy in Thailand, to Vientiane, Laos, the first U.S. aircraft al-
lowed into Laos in more than a year. While in Laos, I had a discussion
with Deputy Foreign Minister Khamphay Boupha, received a briefing
from Mr. Thomas Corcoran, Charge d'Affaires of the U.S. Embassy,
and his staff, and had an opportunity to meet informally with a
number of foreign diplomats and other observers of the Laotian scene.
I then travelled to Rangoon, Burma. President Ne Win was out of
the country and, in his absence, I met with General San Yu, Secretary
of the Council of State, and a number of other Burmese officials.
Ambassador David L. Osborn and members of his staff were helpful
in many ways during my stay in Burma.
I wish to express my appreciation to United States officials at each
of the posts I visited for the assistance they provided, to the Depart-
ment of State for making my travel arrangements, to the Library of
Congress for assembling background materials, and to Mr. Francis
Valeo, Secretary of the Senate, and Mr. Norvill Jones, of the staff of
the Committee on Foreign Relations,both of whom have accompanied
me on a number of past missions, for their assistance in connection
with the trip.
Sincerely,
MIKE MANSFIELD.
(II)














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POSTWAR SOUTHEAST ASIA-A SEARCH FOR NEUTRALITY




SENATE, AUGUST 26, 1976
Mr. MANSFIELD. Mr. President, 1 year ago, on behalf of the Com-
mittee on Foreign Relations, I visited three nations in Southeast
Asia, Thailand, the Philippines, and Burma, to study regional and
local developments after the ending of U.S. involvement in Indo-
china. Upon my return, I reported to the ommittee that:
Throughout Southeast Asia, nations are now making
reassessments of their relationships. Nationalism and
neutrality, mixed with a budding interest in regional co-
operation, are the driving forces at work.
I ask unanimous consent that pertinent portions of this report be
printed in the Record following my remarks.
The ACTING PRESIDENT pro tempore. Without objection, it is so
ordered.
(See exhibit 1, p. 11.)
Mr. MANSFIELD. During the recent congressional reess, I retured
to Southeast Asia to make an up-to-date reappraisal of the situation
A- a r c t port

already been submitted to the President as a result of that trip.
This is my report to the Senate.
Winds of change still sweep the area, continuing to move the
region toward cohesion and an easing of tensions. The U.S. role in
this movement is limited and must remain so. It is not for this Nation,
nor is it possible for this Nation to tell the natios of Southeast Asia
what is in their interest. If we have learned anything from our sad
experience in Indochina, it is that the future of Southeast Asia is for
the nations of the area to decide and without outside interference.
The Philippines, Thailand, a laysia, Singapore, and Indonesia,
through the Association of Southeast Asian Nations, ASEAN, have
taken small but positive steps toward regional cooperation. In Febru-
ary, the heads of state of the five ASEAN members met at their first
summit conference to produce a treaty of amity and cooperation and
other agreements looking toward closer collaboration on problems of
common concern. There remained, however, an uneasy uncertainty

million people, would take in regional affiirs.
Twenty-two years after the Geneva cease-fire agreement which
temporarily divided the nation, the two parts of Vietnam havebecome
one. After three decades of isolation and civil war, Vietnam has
entered the regional political scene. The ASEAN States and Vietnam
have launched a major program of d6tente, which has already produced


(83)
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84

2

an atmosphere of regional friendship. During Jul, Vietnam'sDeuty
ign Minister Phan Hien made a goodwill visit to se the
AEN countries as well as to Burma and Laos. The five ASEAN
countries have established diplomac raons with Vietnam. All
signs indicate that Vietnam has set out to prove to its neighbors and
the world that it is determined to pursue an inde ndendt course,
from domination by eier the Soviet Uio or
These important steps toard am should be welcomed
by the United States. A region organization composed of the
ASEAN nations, the states of Indochina, and Burma, deto
peaceful intercourse, would be a significant force in maintaining
stability and promoting eonomic progress in this volaa. Thi
officials assured me of their strong support for this concept. ile
endorsing a regonwide organization i prnciple, B a has
historical suspicions. i
I will describe briefly some current spects of U.S. relations with
Thailand, Burma, and Laos and the discuss the drug situation, a
problem of particular concern to this Nation, as it involves Burma
and Thailand.
THAILAND
In Thailand, Prime Minister Seni Pramot presides over a slaky
parliamentary government. Although the ruling coalition is c
of only 4 parties, compared with 17 in the previous govern led
by his brother, Kukrit Pramot, there is serious dissension with the
coalition. In addition, there is the ever-present threat of a military
coup. While I was in the country, a crisis arose as a result of thsur-
reptitious return to Bangkok from Taiwan of the former ry
strongman, Field Marshal Praphas Charasathien, who was eld
when the military government was ousted in 1973. It was widel as-
sumed that his return was designed to stimulate ovierthrow the
civilian government by the military. The government'shandling of the
affair aroused strong passions on both the left and the right. Althoug
Praphas was -forced to leave the country, the incident has proba
given encouragement both to opposition elements within the gover-
ment and to antidemocratic elements in the Military Estabi ent.
It is said that the military, much of which is opposed to Thailand's
commitment to regional detente with Vietnam, and Cambodia,
is convinced th the country's experiment with democracy will fil
Although it is making a valiant attempt to survive, the future of
Thailand's fledgling democratic system is less than assured. On
other hand, pr ets for survival of parliamentary gov
aided significantly by a reasonably bright economic picture and vivid
public memories of the opp ive tactics of previous military govern-
ments. Insurgencies in the North and Northeast, and to a lesser extent
in the South, continue but the pblem appears little ch d from
last ear. And the picture is not likel to improve as long s there is
no finm edication Jby thei agk to ~\brigg but
real *economic progres in neglected regions.
The withdrawa July of the last regular U.S. military forces,
leaving only a 250-man advisory unit, was a significant actor in
creating favorable conditions for the establishment 2 weeks later of
diplomatic relations between Thailand and Vietnam. Americans should





85


3

not iterret the Thai demand for the withdrawal of U.S. forces as an
unfriendlfy gesture. It should be seen for what it was, an inevitable
adjustment to the new realities which both countries face in South-
east Asia.
Under the withdrawal agreement the nited States will have cer-
tain aircraft transit rights at the Takli air base. The abuse of this
privilege should be scrupulously avoided, lest it exacerbate the tenuous
political situation in Thailand. Both military and economic assistance
to Thailand continue, although nonconcessional economic aid, other
than that for population contol and antidrug programs, will terminate
next year. Mita grant aid will end in 1977 afso as a result of the
general phaseout voted by the Congress. Consistent with Thailand's
desire to stand on its own two feet, U.S. bilateral aid programs for
population and antidrug activities should be terminated also if the
responsibility for programs in these fields can be shifted to the United
Nations.
The current Thai Government favors continuation of the SEATO
treaty relationship with the United States. Drawn up following the
194 Geneva Conference on Indochina as a device to stop the spread
of communism in Southeast Asia, the SEATO treaty is no longer a
viable multilateral security agreement. It has practical application
only to Thailand. Although I strongly approveof Thailand's desire to
maintain close ties to the United States, I do not believe that trying
to breathe life into the SEATO treaty, a relic of the errors of past
policy, is in the best interests of either country. Sound bilateral trade
and economic relations are far more important to Thai-United States
friendship than a lifeless scrap of paper. Undue emphasis on military
matters would be an anachronism, inconsistent with the current
interests of both countries. It is, however, important that America
continue to demonstrate its desire for close, friendly relations with
Thailand in ways that will promote regional cooperation and heal the
wounds left by the recent war.
BURMA
The situation in Burma has changed little since last year. Burma
continues rigorously to pursue a nonagned course, keepg its distance
from all of the major powers. Seven years ago in a report to the
Senate, I wrote:
The Burmese government continues to go its own way as it
has for many years. It is neither overawed by the proximity
of powerful neighbors nor overimpressed by the virtues of
rapid development through large infusions of foreign aid.
Burma's primary concern is the retention of its national and
cultural identity and the development of an economic system
preponderantly by its own efforts and along its own lines.
That analysis continues to be valid.
In July, a coup plot against President Ne Win's government, insti-
gated by a number of low-ranking, but well-connected, army officers,
was discovered. Although the attempt may signify eroding confidence
in Ne Win's leadership within the army, it did not deter the President
from leaving for Europe in mid-August for medical treatment. On
'~ ~ ~~~~~~~~~ '"","i"*': *C "*: "' "*"'"
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86


4

the positive side, there axe reliable
the government to take ore aggressive action to cure the
Burma's stagnant and inefficient economy. World Bank Consulta-
tiveGroup isbeingfored to aidin
economic changes in advance of participation.
Insurgencies continue in Burmas remote mountaiot,
according to observers, the government has made some progress
within the last year in controng the problem. Although the counts
economy is notoriously mismanaged, it is a country rich in
both in natural resources and people. "No e dies of s
Burma," one top official put it. That says a great deal bout
situation.
The United States owns some $12 million i
which are wasting y way through inflation. My visit to Burma a y
ago came several weeks after a devastating earthquake had seriously
damaged or destroyed many Buddhist temples in historic Pagan. It
required 5 months of prodding within the Governmetin W
to get an Embassy request approved for a token gift of $10,000 of
these currencies to aid in the restoration work at Pagan, approval
that came long after all major nations had made even more subst
contributions. An Embassy request is now pening in the te
Department for use of a modest amount of this U.S.-owned local
currency to make needed improvements in Embassy staff apartments.
I hope that not only will the Embassy's request be approved but a
that a study be made of other appropriate ways to make effective
use of the U.S.-wned holdings.
LAos
With the approval of the Government of Laos, I flew from B ok
to Vientiane in a small aircraft attached to the U.S. Embassy in
Thailand, the first U.S. aircraft of any type allowed into Laos in mo
than a year. I view the Laotian Governments' approval of my flight as
a gesture of goo id will toward the United States
The new government has taken steps to improve relations with
Thailand, although deep suspicions remain from the period when
Thailand was used as a base for military operations against Laos.
Agreement in principle was reached early this month to open several
border crossings on the Mekong to facilitate trade between the two
countries.
In the course of a long conversation with me, the Acting Foreign
Minister, Khamphay Boupha, repeatedly made allegations that the
United States was supporting anti-Lao elements in Thailand. I
assured him that, according to the best information available to me,
the United States was not engaged in any operations in Thailand
directed against Laos.
The Lao Government seeks assistance from all sources, to repair
the damage inflicted on its people and resources during many yeas of
civil and international war. Acting Foreign Minister Kham
told me that 500,000 Loatians were forced to leave their homes because
of the war-a United Nations representati Vientiane said that
the number was as high as 700,000-and that 100,000 were killed





87


5

and tens of thousands wounded, a terrible toll for a country of only
I ... * e" '' 1 a "'
Smillion people. Siiicant United Nations programs are underway
to aid refugees and restore agricultural productivity.
Minister Khamphay assured me that his government "wants to
maintain good relations with the United States on the basis of mutual
respect for each other's independence, sovereignty, and territoial
integrity." The Laotian Government, he said, had two objectives-for





11408. It wuld be my hope that
support by the United States for what e termed the "reactionaly



rators" working against Laos; and second, to obtain assistance for
As noted above, on the basis of oficial information, I was able to
assure the Laotian Deputy Foreign Minister that we were no longer
involved in the internal affairs of Laos. It would be my hope that
n the United States giving any support, directly or indirectly, to anti-




atan l insid se that country, under any cir-
umstances. As to foreign aid, I believe that, at an appropriate time,
consideration should be given to providing relief aid through the United
Sdecent gesture to a poor country in a great need through little fault
of its own.
One problem of concern to many Americans very much on my mind




The Lao have a long tradition of adhering to humanitaian
principles. . The government has ordered the people
throughout the country to look for crash sites and if the
w| be passed to the United States.
In a speech on Pacific policy on December 7, 1975, President Ford
said that U.S. policy towad the new reimes in Indochina will be



on ouir part.

formal diplomatic relations. The nomination of Galen Stone be

paceent should be sent to Vientiane. the present course smacks of










After an investment of $8.5 million in pmen and advisers
the coAt of an additional $2.6 million an f al U.S.
Enforcement Adminitration operations, there is little to show in
Thailand for the American inves
Although thegro of in i

which arrested drug traffickers are quickly rel is still the e.
Hong Kong authorities, who must cope with the flow of drugs from
the Bang connection, are akicant progress local
antidrug programs but are critical of theai Government's laxity in
dealing with drug The authorities ofthr ti
highly critical of the failure of the Thai Government to police its side
of the borderand of the corruptionreputedtoexistintheThaipo
system.
To be sure, the Thai Government has to deal with many problems.
Stoppi the Bangkok drug traffic, however, is a major hee.
Until there is much greater commtment to with the
putting more millions of American money into bu hecopters,
radios, jeeps, and other fany equipment for the Thai ant coti
police will not have the desired effect.
helicopters the United States has provided wi thear for
antinarcotics operations. Six more are yet to be delivered. The Bur-




years, if an effective herbicid eradication prois
crop substitution schemes now being planned have the
traditional opium growers. Efforts have been made to estaS.
Drug Enforcement Agency presence in Burma, a move rsisted in
Burma. In my judgment, the arguments against DEA
personnel into Burma are fully tenable and there is no reasonable justi-
fication for such an expansion of the bureaucracy.
Laos is not a factor in the external opium trade acordin to most
experts. The current Lao Government is tastic m urto
cure drug addicts, sending them to an island the middle of the
Mekong for intensive treatment. As to China, all U.S. ff s iil
the area agree that it is not a source of narcotics for the outside w
producing only as much opium as isrequiredfor inme
needs.
U.S. narcotics operatives in police actions abroad. As a result, Con-
adopted a proposal which prohibits U.S. personnel abroad
rom paticipating in any fore police rest actions
with narcotics operations. The Drug Enforcement mini
issue guidelines for implementation of this provision and I have been
assured by Mr. Peter the DEA Adminitrator, that both
the letter and the spirit of the law will be strictly enforced
In view of the fact that the drug problem is international in scope,
I also recommended last year that the U








7

to the United Na-
tions. Congress has directed the President to make a study of how to
Sa, for xampe, the
Si d d i otheanti-
drug programs. Burma, intent on mataining its distance from all
major powers, has indied keen interest in obtaining throuh the
Uted Nations assistance of the kind we now provide on a biateral
basis. I believe that lead of the Thai Goverment would also be
more comfortable if the United Nations'took the lead from the United

The Committee on Foreign Relations should make a thorough
study of the foreign operations of the antinarcotics program. It is an
expensive program, costing $37.5 million for direct aid alone in the
last fs ye. It is also an administrative nightmare involving the
operations abroad f at least fie Departments and agencies-the
DEA, AID, CIA, the Department of Agriculture, and the Depart-
ment of State, which, through our ambassadors, is supposed to be in
charge of the entire operation. Pending submission of the Presidential
report on shifting emphasis to the United Nations or regional pro-
grams, the committee should make a careful study of the manage-
ment and cost effectiveness of all current drug operations abroad.


While I was in Southeast Asia, an event of significance took place in
Sri Lanka, the Fifth Conference of the Non-Aligned Nations. The dele-
ates at Cl o reresetd two-thirds of the nations of the world
aad one-third of its inhabitants, a three-fold increase from the 28
nations represented at the founding meeting at Bandung two decades
ago. Much of the rhetoric that came out of the conference hall in
Colombo was not very palatable to us. Nevertheless, it is in our
national interest to pay close attention to the Third World, to what
the leaders of these countries think and seek. The United States is
rapidly becoming a have-not Nation in regard to basic resources on
which we and other industrial nations are dependent. The Third World
straddles a good share of the world's supply of these resources and
I returned from my visit to Southeast Asia witha firm conviction
that, in general, developments in the region are moving in the right
direction, both for the nations concerned and for the United States.
The Southeast Asian countries appear determined to pursue an inde-
pendent path, free of outside domination by ny power. There are

regional understanding, or, at a minimum, to join hands in preventing

Vietnam, contrary to many predictions, is demonstrating a desire to
live in peace with its neighbors. It has now applied for membership in
the United Nations. I hope that the United States will not again veto
its Our rations with the nations of Indochina hould be

sp fit reality. The reality is tat new governments are in firm
control in Vietnam, Cambodia, and Laos.
Seven years ago the Senate approved a resolution, offered by


Senator Cranston, which stated th at-
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8
hen the Uted in n n
and exhanges representatives with it, this does not of itself

or policy of that government.

simply a recognition of de facto and d4 jure control That should be



for i
the basis for U.S. policy toward tthe new governments of Indochina.
Americans a to
the past and look to the future. A eneration our Nation was locked
in a lifeanddethstruggle with Germany and Japan. Today they are
allied with us. National interests are not immutable. Interests, and the
policies to further them, must reflet a world. We should
lookto thepast for wisdom, to learn how to shape the
the purpose of perpetuating animosity or bitternes.

inAsia with a viewto wipingtheslte n n
bureaucracies or individuals to shake off the habits of
decades. Much of the Government foreign afairs bureacracy, from
State Department policyakers to CIA o ativeappe
be still too closely attuned to policiesof thepast.
There are deep suspicions in the region that remnants of operations
related to the old policies continue, particularly as to CIA operations.
It may be that intelligence gathering, for example, has not yet been
keyed to the new situation in In and to the goal of no
lations with China. In any event, thattheSele
on Intelligence will make a thorough review of current
operations in Asia to insure that they ar a
long-range national objectives.
In closing, I add a short postsript to my recent report to
Committee on Foreign Rlations concerning Japan and Korea.
Both en route to and on return from Southeast Asia, I to in
Tokyo to receive a briefing on recent developments from of
the U.S. Embassy. The Lockheed scandal continues to dominate
Japanese political affairs as the Watergate affair did here for so long
Prime Minister Miki's determination to brinf out all the facts, regard-
less of where the chips might fall, has created great controversy within
his own party but has met with widespread public and news media
approval. It is to be hoped that the matter will be handled in such a
way that neither the confidence of the Japanese people in their govern-
mental processes nor that nation's political stability will be damaged.
As to the incident in Korea, the brutal killing of two American
officers in the joint security area of the Korean demilitarized zone, and
subsequent actions have aroused passions on both sides, unde
what I said in my report scarcely a month ago: "Korea is a timebom
which has yet to be defused."





91


9

Tis i t t ammatoy incident to occur in the nearly
quarter of a century since the cease-fire agreement that ended the
Korean wa d it will not be the last. When fighting men are placed
in to the enemy on a daily basis incidents are bound
to happen. It takes onily a match to start a conflagration.
The President is to be commended for having insisted that U.S.
kep cool in the recent traged because under existing cir-
cumstances U.S. forces will be involved inevitably in any outbreak
ofn orea. The swift dispatch to Korea of additional U.S.
attack aircraft and a carrier tak force demonstrate that under current
o U.S. military forces wil be involved from the
Ss ption of hostilities, despite the constitutional
esponsility of Congress to declare war.
he Una in a vise in Korea from which it must eventually
extricate itself by a phased withdrawal of forces while simultaneously
a t solution to the conflict. It is to e hoped that the
recen cident will not delay U.S. initiatives in that direction.









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Exhibit 1
EXCERPTS FROM WINDS OF CHANGE-EVOLVING RELATIONS AND
INTERESTS IN SOUTHEAST ASIA-AUGUST 1975
I. THREE VARIATIONS ON NEUTRALISM
President Nixon's visit to Peking in 1972 released strong winds of
change in the international relationships of Asia. The collapse in
South Vietnam and Cambodia intensified these currents. Visible
changes already include the restoration of contact between the
United States and Chia looking in the direction of normalcy after
many years of acrimonious confrontation. This shift has been a key
factor in enabling us to reduce the U.S. military presence in Asia


U.S. policy, in short, is beginning to reflect the fact that the United
States is a Pacific nation, but not a power on the Asian mainland.
The waters of the Pacific touch the shores of the United States on
the West Coast, at Hawaii, Alaska, the territory of Guam and the
U.S. trust territories. They also beat against the coastlines of seven
nations to which we have made security commitments-Japan,
South Korea, Taiwan, the Philpines, Thailand, Australia and New
Zealand-as well as the shores of the Soviet Union and China. What
takes place in this vast region is of deep concern to this nation.
However, concern and capacity to influence are quite different. What
we began to- perceive in Korea and saw very clearly in Indochina
is that our capacity to influence the flow of history on the Asian
Mainland itself is quite limited on the basis of any rational input of
manpower and resources.
After the birth of the People's Republic of China in 1949, we es-
tablished a policy of containment of Communist China. It was a
policy which sought to line up nations on an either "for or against"
basis with "neutralism" regarded as something to be spurned. A
ring of treaties was engineered in an effort to use U.S. power and in-
fluence to choke off what were held to be China's aggressive designs
on its neighbors. In Southeast Asia, both Thailand and the Philippines
linked their foreign policy directly to what became a U.S. crusade
against communism on the Asia Mainland, Burma and Cambodia,
each in its own way, tried to walk the tight rope of non-involvement.
The former did so throughout the Indochina war, in part, by rejecting
U.S. and other forms of foreign aid. Under Piince Norodom Sihanouk,
Cambodia also held the line of non-involvement successfully for
many years. When the Prince was overthrown by a military coup,
however, the Khmers paid the cost in five yea of bloody war.


(93)
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94


12

The overthrow of Sihanouk also added more U.S. casualties and
bilions to U.S. costs in Indochina as this ntion went from non-
involvement to the aid of the s in
Penh.
Throughout Southeast Asia, nations are now making major reas-
sessments of their relationships. Nationalism and neutrality, mixed
with a budd interest in regional cooperatio, are the dri
forces at work.eutakes on different characteristics in eac
of the Southeast Asian nations. Burma is a stual
neutrality with a heavy accent on isolationism. T,
nation in the region to remain free of colonial rule befor World War
II, is in weng in writing another chapter in its long history f
to balance its independence amidst shifting poitical curr Three
decades after close alignment with and vestial dependeny o th
United States, the Republic of the Philippines is moving to the more
open waters of international relations and accelerating is ert
achieve a fully independent identity
As new relationships evolve in Southeast a, robles a
emerging among the nations in the area and in their relations with the
United States. Changes in an old order always carry a degre of pain-
ful adjustment. It is to be hoped, however, that out of the old, even-
tually will emerge a new spirit of self-reliance and regiond cooperation.
In that fashion, the independent nations of the region may b able
to live together in a zone of peace respected by all of the great powers.
That is the goal towards which each nation visited, n ts own way
and to some degree, all of them together, seemed to be movi
The Asian nations are very likely to call for adjustments of
the relationships with the West which grew out of a previous state of
dependency. We should do our best in our own interest to accom-
modate to hanes of this kind. They involve, in man cases, as in
Indochina, the lightening of an ecessive and one-sided burden whi
has been maintained for decades by the people of th United States.
From our own point of view, it would be desirable to s ect the
Southeast Asia Collective Defense Treaty, the so-called Mnla Pact,
to critical reexamination. The treaty seems to me of little relevance
to the security of this Nation in the contemporary situation. In fact,
it may be more a liability than asset to all of th ignatorie
As for our relations with Indochina, it would seem to me helful
dealing with the vestigial problems of the war and in paving the ay
for a peaceful future to establish direct contact with te suc
governments in Vietnam and Cambodia at an appropriate time.
It would be unfortunate if out of indignation or disillusionmnt we
should turn our backs on Asia. More inline with our interests wold
be to seek to understand more clearly what is transpiring onthat con-
tinent. Our young people, in particular, need as much expos
possible to the changes in Asia since they wil experience in the
ahead most of the consequences. Through diplomacy and utu
contacts we should be able to harmonize our reasonable national
interests in security, trade and cultural cross fertilization with the
emerging situation in Southeast Asia. The present transition need
not be a source of anxiety if it is approached in that fashion. Indeed, we
could be on the verge of a new era which could bring great benefits
both to the Asian countries and to this Nation.