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8 SECRET Industry. provide for this increment to the population, a large-scale investment and extensive tech- The fact that more than 99 percent of re- exported Indonesian products were first proc- nical training program is required. Through essed in the Netherlands is in itself an in- June 1950, unemployment among the returned dication that Dutch industry is greatly de- soldiers was surprisingly small, particularly in pendent upon Indonesian raw materials. The view of the fact that many lacked technical rubber and margarine industries are based training. Because of the plans for an in- upon Indonesian imports, and the tin smelter creased military establishment and military at Arnhem depends entirely upon Indonesian production in the Netherlands, it is likely that tin ore. Indonesian independence probably military or civilian employment will be avail- will have little effect on sales to the Nether- able for most of the repatriates. lands for processing and re-export. More In the years before the War, the Nether- serious repercussions on the transit shipment lands had a small net gain in the total ex- of Indonesian goods through the Netherlands, change of population with its overseas terri- however, can be expected. RECORDS ARQUIVES tories, of which Indonesia was by far the most The Dutch in Indonesia. SERVICE "NATIONAL important. It is possible that, if the Nether- lands had retained Indonesia, this trend would The number of Dutch nationals employed in have been reversed as the pressure of over- Indonesia before and since World War II population in the Netherlands increased. The totalled only about 35-40,000, but their income fact remains, however, that Indonesia has was substantial and their ties to Indonesia never been an area for extensive Dutch were close. Their earnings in 1938 are esti- settlement, and, with the granting of Indo- mated to have been approximately 120 million nesian independence, is never likely to be. guilders ($65.9 million), or roughly the equiv- alent of 2.4 percent of the Netherlands na- 3. Military Repercussions. tional income for that year. With the trans- The postwar conflict in Indonesia demanded fer of sovereignty at the end of 1949, many the full attention of the Dutch armed forces Netherlanders expressed a desire to leave In- and placed a severe strain on financial and donesia as soon as possible, and many already manpower resources. The reduction in Dutch have returned to the Netherlands. A total of military commitments in the Far East due about 36,000 are expected to return during to the granting of Indonesian independence 1950. About 3,200 Dutch nationals of some will not immediately increase the Netherlands' 10,000 at present employed by the Indonesian military capabilities in Europe, because the Government will probably remain, but of these greatest military needs at present are modern only about 1,000 are Europeans, most of them equipment and instructors to train soldiers being Indo-Europeans. Many Dutch in pri- in its use. Nevertheless, Dutch military policy vate enterprises, however, particularly those and planning are now undergoing important whose families have lived in Indonesia for gen- changes, and the greatest emphasis is being erations, can be expected to try to stay in In- donesia permanently. The Netherlands Gov- placed on the reconstitution of the metropoli- tan ground forces in line with the Netherlands ernment is not encouraging the return of its commitments to the Western Union and the people from Indonesia, because of overpopu- lation in the Netherlands. North Atlantic Treaty Organization. Sub- stantial increases in military expenditures Another problem will result from the return after 1950 will meet opposition from civilian of the Netherlands troops from Indonesia. officials, however, on the grounds that the The large annual increase (40-45,000) in the metropolitan defense can be increased by Dutch working population is, in itself, a prob- utilizing funds formerly devoted to the forces lem for the government, and is aggravated for Indonesia. this year by the repatriation of some 70,000 troops, which began in late 1949 and is still in- Under The Hague Agreement of November 1949, Dutch military commitments in Indo- complete. In order for the Netherlands to nesia were reduced to: (1) performing naval SECRET UNCLASSIFIED

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    "ocrText": "8\nSECRET\nIndustry.\nprovide for this increment to the population,\na large-scale investment and extensive tech-\nThe fact that more than 99 percent of re-\nexported Indonesian products were first proc-\nnical training program is required. Through\nessed in the Netherlands is in itself an in-\nJune 1950, unemployment among the returned\ndication that Dutch industry is greatly de-\nsoldiers was surprisingly small, particularly in\npendent upon Indonesian raw materials. The\nview of the fact that many lacked technical\nrubber and margarine industries are based\ntraining. Because of the plans for an in-\nupon Indonesian imports, and the tin smelter\ncreased military establishment and military\nat Arnhem depends entirely upon Indonesian\nproduction in the Netherlands, it is likely that\ntin ore. Indonesian independence probably\nmilitary or civilian employment will be avail-\nwill have little effect on sales to the Nether-\nable for most of the repatriates.\nlands for processing and re-export. More\nIn the years before the War, the Nether-\nserious repercussions on the transit shipment\nlands had a small net gain in the total ex-\nof Indonesian goods through the Netherlands,\nchange of population with its overseas terri-\nhowever, can be expected.\nRECORDS\nARQUIVES\ntories, of which Indonesia was by far the most\nThe Dutch in Indonesia.\nSERVICE\n\"NATIONAL\nimportant. It is possible that, if the Nether-\nlands had retained Indonesia, this trend would\nThe number of Dutch nationals employed in\nhave been reversed as the pressure of over-\nIndonesia before and since World War II\npopulation in the Netherlands increased. The\ntotalled only about 35-40,000, but their income\nfact remains, however, that Indonesia has\nwas substantial and their ties to Indonesia\nnever been an area for extensive Dutch\nwere close. Their earnings in 1938 are esti-\nsettlement, and, with the granting of Indo-\nmated to have been approximately 120 million\nnesian independence, is never likely to be.\nguilders ($65.9 million), or roughly the equiv-\nalent of 2.4 percent of the Netherlands na-\n3. Military Repercussions.\ntional income for that year. With the trans-\nThe postwar conflict in Indonesia demanded\nfer of sovereignty at the end of 1949, many\nthe full attention of the Dutch armed forces\nNetherlanders expressed a desire to leave In-\nand placed a severe strain on financial and\ndonesia as soon as possible, and many already\nmanpower resources. The reduction in Dutch\nhave returned to the Netherlands. A total of\nmilitary commitments in the Far East due\nabout 36,000 are expected to return during\nto the granting of Indonesian independence\n1950. About 3,200 Dutch nationals of some\nwill not immediately increase the Netherlands'\n10,000 at present employed by the Indonesian\nmilitary capabilities in Europe, because the\nGovernment will probably remain, but of these\ngreatest military needs at present are modern\nonly about 1,000 are Europeans, most of them\nequipment and instructors to train soldiers\nbeing Indo-Europeans. Many Dutch in pri-\nin its use. Nevertheless, Dutch military policy\nvate enterprises, however, particularly those\nand planning are now undergoing important\nwhose families have lived in Indonesia for gen-\nchanges, and the greatest emphasis is being\nerations, can be expected to try to stay in In-\ndonesia permanently. The Netherlands Gov-\nplaced on the reconstitution of the metropoli-\ntan ground forces in line with the Netherlands\nernment is not encouraging the return of its\ncommitments to the Western Union and the\npeople from Indonesia, because of overpopu-\nlation in the Netherlands.\nNorth Atlantic Treaty Organization. Sub-\nstantial increases in military expenditures\nAnother problem will result from the return\nafter 1950 will meet opposition from civilian\nof the Netherlands troops from Indonesia.\nofficials, however, on the grounds that the\nThe large annual increase (40-45,000) in the\nmetropolitan defense can be increased by\nDutch working population is, in itself, a prob-\nutilizing funds formerly devoted to the forces\nlem for the government, and is aggravated\nfor Indonesia.\nthis year by the repatriation of some 70,000\ntroops, which began in late 1949 and is still in-\nUnder The Hague Agreement of November\n1949, Dutch military commitments in Indo-\ncomplete. In order for the Netherlands to\nnesia were reduced to: (1) performing naval\nSECRET\nUNCLASSIFIED"
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