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Thursday, 31 March 1966

Mr HAROLD HOLT - I do not think there is any doubt, from the information reaching the Government, that there has been a significant improvement in morale inside South Vietnam since the build up of allied forces, particularly United States forces, in that country. I believe this improvement in morale is not confined to South Vietnam itself; it has certainly, I think, been a factor in strengthening the attitude of neighbouring countries, and I would not put it out of my own belief that it has been a factor in recent events in Indonesia. I believe that new heart has been given to those resisting the thrust, the subversion and the terrorism of Communism in South East Asia by the knowledge that friendly countries, including the most powerful democratic country in the world, are joining together in determined and resolute action to resist the thrust of Communism in the South East Asian area.

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