As early as in November, 1939, the Japanese Government proposed to the Netherlands Government to open economic negotiations between Japan and the Netherlands East Indies to which the latter agreed in principle. Accordingly we informally showed them the outline of our proposals. In the meantime, we carried on negotiations with the Netherlands authorities at Tokyo, The Hague and Batavia with respect to the opening of negotiations in a concrete manner. However, the European War spread to the Netherlands in May, 1940, and the Netherlands East Indies came to feel its effects with the result that the situation developed in such a manner that Japan, striving as she has been for the establishment of a new order in East Asia, could not remain indifferent. The Japanese Government, therefore, made a request to the Netherlands Government that the negotiations, with a view to establishing relationship of economic cooperation between Japan and the Netherlands East Indies be speedily opened.
The situation at that time was such that, since the Netherlands Government had moved to London and decided to carry on the
war in alliance with England and the economy of the Netherlands East Indies was mobilized for war purposes, the economic relations between Japan and the Netherlands East Indies was bound to be gravely affected. Due to the necessity of establishing the relationship of common prosperity through close cooperation among the peoples of East Asia, the Japanese Government cannot, of course, remain indifferent to the spread of the European War to the South Seas. Moreover, it was clear that the demand, on the part of Japan, for such resources as are found in the Netherlands East Indies would steadily increase in the course of her establishment of a highly organized defence State. Under these circumstances, it was necessary for Japan to be assured, as early as possible, of the supply of essential resources, and to establish economically cooperative relations between Japan and the Netherlands East Indies, thereby bringing about the stabilization of East Asia. The Japanese Government accordingly requested the Netherlands Government, in May of last year, for an assurance of supply to Japan of those important materials and goods which Japan expected of the Netherlands East Indies under the prevailing situation. In response to this, the Netherlands Government expressed their intention of actively cooperating with Japan, by assuring that the economic relations of the Netherlands East Indies with Japan would continue as smoothly as before, and confirming that such relations would be in harmony with vital interests of the Netherlands East Indies and would contribute toward the peace and stability of East Asia. On the basis of this agreement of views between Japan and the Netherlands East Indies, the Japanese Government have conducted economic negotiations at Batavia since September of last year, exerting utmost efforts for their amicable conclusion.
The negotiations between Japan and the Netherlands East Indies are so varied as to include not only the question of acquiring materials and goods, but the question of promoting general trade relations, the entry of the Japanese into the Netherlands East Indies, the pursuit of occupations, the investments in enterprises, shipping, aviation service, and communications. As regards the aforementioned matters, especially aviation connections, they are already being carried on between the third Powers and the Netherlands East Indies ; and in investments in enterprises, such as the oil industry, Anglo-American capital has been showing remarkable activities. The third Powers are thus very liberally permitted to engage in all these enterprises. In the light of these facts, the requests of the Japanese Government are very reasonable. If such Japanese requests, as for the participation of the Japanese in the
development of abundant natural resources of the Netherlands East Indies, the entry of the Japanese there attendant upon such development, the pursuit of occupations, the calls of Japanese ships at closed ports for the purpose of transporting materials produced by such development, partial opening of the coast-wise navigation to Japanese ships and the development of the fishing industry by the Japanese who are there, were dealt with on the basis of promoting economic cooperation between Japan and the Netherlands East Indies, the solution of these questions would be very simple.
Regarding these requests, the Netherlands East Indies Government, on their part, have stressed that the basis of their policy lies in the progress, prosperity and emancipation of the inhabitants of the Netherlands East Indies. It is clear, however, that the proposals of the Japanese Government do not in any respect run counter to such a policy of the Netherlands East Indies. Needless to say that the progress, prosperity and emancipation of those inhabitants can be promoted, on the part of the Netherlands East Indies, through the establishment of economic cooperation between Japan and the Netherlands East Indies, and thereby contribute toward the peace and stability of East Asia.
However, along with the intensification of economic warfare the situations surrounding the Netherlands East Indies have made difficult a smooth progress of the negotiations. The reply of the Netherlands of June 6 not only is very unsatisfactory but asserts, in connection with the question of acquisition of essential materials and goods to which Japan attaches importance, that their quantities may be decreased at any time to suit their own convenience. In view of the fact that regarding this question, the Government of the Netherlands and as well as the Netherlands East Indies authorities have, on many occasions in the past, made promises or declarations to Japan, the Japanese Government, deeming such contents as are embodied in the Netherlands reply to be hardly worth being specially incorporated in an international agreement, have decided to discontinue the negotiations and to withdraw their Delegation, ordering Mr. Kenkichi Yoshizawa, their special Envoy, to return to Japan. However, it goes without saying that Japan will hold fast to her just and fair contentions, while the normal relations between Japan and the Netherlands East Indies will by no means be affected by the discontinuance of the negotiations.