Foreign Relations of the United States, 1952–1954, The Near and Middle East, Volume IX, Part 2

874.00 TA/11–653: Telegram

No. 1240
The Acting Secretary of State to the Embassy in Egypt¹

secret

Washington, November 6, 1953—5:49 p.m.

519. Dept restudying on staff level question economic aid to Egypt. Point at issue is whether it would be best to launch program publicly at earliest possible moment or to follow our previous plans of awaiting UK–Egyptian agreement.

Factors seem to be these:

(a) US–UK Relations. Subject involves US–UK relations and would have to be discussed with UK. Over past year British have stressed that we make our assistance in economic rather than military field if time came when we felt we must in our own interests assist Egypt. We have over that period of time become increasingly committed to British against provision of military assistance prior to agreement on Suez Base. Record is less specific on economic assistance. We have at times felt that introducing such aid on our part might at right time prevent collapse negotiations. It was at time of exchange of letters between Naguib and President that our course of waiting for agreement seemed to become fixed. Naguib asked whether US could make definite commitments in both economic and military fields “simultaneously with the signing of the agreements.” We responded affirmatively. We were all of course hopeful at that time that agreement would soon be reached. Query: Would British react strongly if US economic assistance preceded agreement on the Suez Base?

(b) Status of Negotiations. Negotiations deadlocked and chances successful conclusion far from certain. We cannot discard possibility that British for domestic political reasons are coming to conclusion they cannot afford agreement with Egypt at this time. Whether this is case or not, failure negotiations on question of uniforms would be on an issue which neither we nor world opinion could consider significant from viewpoint either US or UK security. On remaining question on availability we also see no real security, as distinct from domestic political, significance as in operative sense even British formula appears meaningless. If negotiations fail we consider it to be in interests both US and UK that we retain as much influence in Egypt as is possible under circumstances. As seen from here it would be most difficult and perhaps impossible retain any position at all. Conditions might be such that we could not extend even economic assistance. On other hand if it could be used profitably and help retain US position we would wish to proceed. Query: Is holding back of US economic assistance, upon which Egyptians feel we are administratively able to proceed, an adverse or beneficial factor upon remaining negotiations? Query: Is it more difficult from viewpoint of US–UK relations to start economic assistance while negotiations still in process or immediately after a break in negotiations?

(c) US Position in the Middle East. Developments in Israeli-Arab matters have seriously affected US position in many of Arab states. Strong measures of US in temporarily withholding assistance to Israel and in taking Qibya aggression before Security Council² have not offset reaction against US by acts of what they look upon as US-sponsored state of Israel. We have now announced resumption aid to Israel and would like follow quickly with some assistance on Arab side. Assistance to Arab states takes form of developing projects which are difficult to start. We are therefore some stage away from conclusion of any negotiations and agreements will be of type which do not normally lend themselves to announcement of any specific magnitude of assistance. Query: Is our situation in Arab world as seen from Cairo such that we should adopt different procedure with Egypt, leader of these Arab states, and plan for early announcement of economic assistance to Egypt working out details later?

Request comments Cairo and London without discussion Foreign Offices including appraisal by London real intentions British at this stage re Egypt.

Smith

1. Also sent to London as telegram 2473. Drafted by Byroade and approved by Jernegan.
2. For documentation regarding the Qibya aggression, see Documents 947 ff.