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Documents Relating to New Zealand's Participation in the Second World War 1939–45: Volume III

37 — The acting Prime Minister to the Rt. Hon. P. Fraser (London)

The acting Prime Minister to the Rt. Hon. P. Fraser (London)

24 July 1941

Government and War Cabinet have given full consideration to telegrams [Nos. 35 and 36] of 22 July from the Secretary of State for Dominion Affairs (telegram M.1731 not yet received). Whilst we recognise the danger of immediate economic action in relation to the contemplated occupation of Indo-China bases, we are of the opinion that the weight of evidence supports the economic sanctions proposed by the United States. We are satisfied that the southward move to Indo-China, if and when achieved, will not end there but will be used by Japan to strengthen bases and to consolidate for yet a further southward move. It does not appear reasonably possible to avoid conflict with Japan if Indo-China is occupied, and this being so we page 47 consider that, if the possibility of conflict is extended by the proposed economic measures proposed and taken by the United States, their co-operation in the conflict should be inevitable. For our part we will take whatever economic steps which the policy of the United Kingdom may determine, and feel that we should give full co-operation to the United States if they decide on the freezing of Japanese assets as proposed. If you are also in agreement with this viewpoint I will be grateful if you would on our behalf immediately convey our concurrence to the United Kingdom Government.