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(g) It is to be anticipated that Japan will exact a price-
for her mediation in the dispute between Thailand and Indo-China. This may take the form of a demand for military and air bases in Thailand, and for a naval base at Camranh Bay. Japanese naval units are already in Thai waters.
Japan's probable action.
3.
Reports have been received from consular sources in Indo-China that in return for her mediation, Japan is to demand the use of Camranh Bay and aerodromes in Cochin China. It is also reported that she will demand naval bases on the East and West coasts of Thailand. has the only first class anchorage in the South China Sea,
Camranh Bay excluding British and United States possessions. base at Soukhla, which is on the road and railway, would
A Japanese afford a means of supply to ports on the west coast of Thailand, Japanese occupation of ports on the west coast would menace the Malacca Straits and endanger the supplies and rednforcements for Singapore both by sea and land.
4.
With naval bases at Camranh Bay and in Thailand, Japan would be enabled to stage an attempt against either:-
Malaya; or
The Netherlands East Indies and British
North Borne..
An operation against Malaya and Singapore would be lengthy and difficult, and would give the United States an opportunity of concentrating their Fleet and threatening the Japanese flank. At the same time, the danger of a direct move against Malaya is very great.
5.
A move against the Netherlands East Indies would offer the Japanese great strategical and commercial prizes. It would be a relatively easy operation and Japan may think that she would be able to avoid direct conflict with the United States and ourselves.
6.
For the above reasons we think that Japan's first objective would be the Netherlands East Indies.
7.
Japan might possibly employ her forces in an attack on Burma. We think this unlikely however as the terrain over which the Japanese would have to advance is extremely difficult and the operation would be unprofitable as compared with the alternatives open to her. At the same time, the acquisition of air bases in North West Thailand would facilitate Japanese air operations against the Burma Road and Rangoen.
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