18. A most fundamental question in the multi-racial society of Sarawak is that of race relations. In recent years relations between the different communities have been excellent and Sarawak has clearly had the good fortune of being a very happy country. It is true that under a colonial administration, where power manifestly rests not with any one racial group but with the colonial Power which is held in regard for its efficiency and impartiality, the harmony of racial relations on the surface may tend to conceal latent friction. So long as the reins of power are firmly in the colonial administration's hands there is little conflict of interests between the indigenous people on the one hand, and the immigrant races, in this case the Chinese, on the other, who are on the whole satisfied to go their separate ways.
19. However, this state of affairs could only last as long as political power remains with the colonial authority. We saw in Sarawak the conflict arising when a transfer of power is contemplated in some form and the indigenous people become aware of the prospect of having to share political power with the immigrant races at a time when they feel themselves still economically backward.
20. Uneasiness was felt at the time after the first elections when the first political party, the Sarawak United Peoples Party (S.U.P.P.) was formed with predominantly Chinese leadership. Taken as a signal for the beginning of the bid for power by the non-natives at a time when the natives felt themselves not yet in a position to compete, this set in motion the strain in race relations springing from the imbalance in economic power. The emotional identification by races became intensified as a result of fear of, and the desire for protection against, the domination of the other race groups. For this reason the Party Negara (Panas) and later the Sarawak National Party (S.N.P.) with native leadership came into being followed by the formation of Barisan Anak Jati Sarawak (Barjasa) and its proposal to enter into an alliance with S.N.P. The present proposals for a Malaysian Federation and the prospect of independence within the Federation have served to accentuate these developments. We, therefore. fully understood the reasons for the alignment of political forces along racial lines. Nevertheless, it is a matter of the gravest concern.
21. The position in Sarawak is further exacerbated by the fact that the present Government in Malaya, which would clearly be an important force in a new Federation of Malaysia, is anti-Communist. In the absence of some project like Malaysia, the Chinese, with their rapidly increasing population and their long start over other races in education, could expect, when independence came, to be in an unassailable position in Sarawak. This, in turn, could put the Communists, with their highly developed organisation to work on the fears and frustrations of the great body of non—Communist Chinese, in an equally unassailable position. The Malaysia proposals would interfere with this development. Communist elements have therefore worked ceaselessly to exaggerate the fears which the Chinese community as a whole and members of other communities have of Malay domination and to make capital out of every possible issue, e.g., special position for the natives, citizenship, national language and religion. They have also worked on the emotions of a large body of younger Chinese, who have been educated in Chinese schools, who are strongly nationalistic and who have feelings of frustration and anxiety about their prospects. The activities and the methods adopted by the extreme Left-wing
