Office of the Historian

874.00 TA/11–953: Telegram

No. 1241
The Ambassador in Egypt (Caffery) to the Department of State1

secret
priority
Cairo, November 9, 1953—10 p.m.

543. In reply Deptel 519 I have following comments to make:

(1)
British will probably (as they did in case of military aid last year) make every effort to prevent US economic assistance to Egypt at this point.
(2)
Up to time of Byroade–Badawi conversation2 Egyptians had been led to understand that all aid was conditional on Anglo-Egyptian [Page 2159] agreement. Thus RCC’s decision to stand fast on availability and uniforms was taken in expectation that it meant no aid.
(3)
In light of above it is most unlikely that continuing to hold back economic assistance will induce change in Egyptian position. On other hand if we fail to do anything positive at this juncture (particularly since possibility of early economic aid has been mentioned to Badawi and Egyptian Ambassador) we will be a long time convincing Egyptians that US foreign policy is not “made in Downing Street”.
(4)
It is my impression that both sides are content to let present situation continue until outcome of Sudan elections are known. Furthermore, Stevenson has let me know he is returning end of the month. Stevenson is more realistic than Robertson and Hankey who probably will be leaving. Hankey is ill and Robertson goes to his new job. There will probably, therefore, be few more quiet weeks in which to try to lay ground work for possible resumption of talks. I believe announcement of US economic assistance during this period would be much less difficult from viewpoint US–UK relations than afterwards. I also believe it would have maximum beneficial effect on both Egyptians and British (assuming base agreement remains our goal).
(5)
Prompt announcement of significant economic assistance to Egypt while it might not necessarily please other Arab League States might help to counteract adverse effect of recent $26 million release to Israel. It would also set hopeful example for Arab countries and increase Egyptian disposition to be helpful with them on Jordan Valley scheme.3
Caffery
  1. Repeated to London as telegram 211.↩
  2. Assistant Secretary of State Byroade and Dr. Bahgat Badawi, the Egyptian Minister of Commerce and Industry, had a conversation on Oct. 20. Byroade asked Badawi if the granting of economic aid previous to the settlement of the Suez base issue would be more advantageous to Naguib than would an announcement, after the settlement, of a single larger package of military and economic aid. The Egyptian answer was that such a step was preferable, and Byroade said he would look into this possibility. (774.5 MSP/10–2053)↩
  3. For documentation regarding the Jordan Valley project, see Documents 381 ff.↩