405. Memorandum of a Conversation, Department of State, Washington, November 14, 19551
SUBJECT
- High Aswan Dam
PARTICIPANTS
- The Acting Secretary
- Sir Roger Makins, British Ambassador
- G—Mr.Robert Murphy
- E—Mr.Herbert V. Prochnow
- NEA–Mr.George V. Allen
Speaking under instructions, Sir Roger stated that the U.K. Government wanted to “work through the IBRD” in connection with the High Aswan Dam, and said he was ready to talk with the United States and IBRD authorities with a view to agreeing on proposals to be put to the Egyptian Finance Minister, Mr. Kaissouni, who is seeing Mr.Black on November 23. He said he presumed that the United States would wish the Bank to take the lead in the matter.
Mr.Hoover said we did since, if we were out in front, we would be called on for assistance on many other projects in the Middle East.
Sir Roger said his Government wanted to discuss: (1) the upper limit of the IBRD loan, (2) whether any “medium credit” extended by construction firms would reduce the amount of IBRD loan, and [Page 743] (3) what simplification the Bank would accept regarding international tenders. Mr.Hoover said he understood the Bank was thinking in terms of a $200 million Bank loan, that any credits extended by construction firms would reduce this amount, and that no time would be lost by the Bank’s requirements for international tenders since at least one year would be needed before construction contracts could be let.
Mr.Allen asked whether Sir Roger thought the United Kingdom would impose any political conditions on its contribution towards the Aswan Dam. Sir Roger said it would not but that he had been asked to find out what conditions the United States might impose.
Mr.Hoover asked about the Sudan. Sir Roger said that the Sudanese Government had fallen on the very day the last British soldiers left the Sudan and that some time might be required before another functioning government was in office.2 He said Mr. Kaissouni had proposed that “any additional water that becomes available as a result of the Aswan project be divided 50–50 between Egypt and the Sudan.”
Sir Roger emphasized that his Government regarded the Aswan project as one of the highest urgency, requiring promptest action. Mr.Hoover said that the United States shared this view and was ready to proceed with the talks. He thought, however, that a “letter of intent” by the Bank would take care of the Soviet threat.
Sir Roger said that during Mr. Kaissouni’s conversations in London, the latter had urged: (1) that the IBRD accord a higher credit-worthiness figure for Egypt; (2) that the consortium increase the medium-term credit it was prepared to extend; and (3) that the Sudan hurdle be “got over.”
It was agreed that the meeting with IBRD and Treasury officials be set for November 16.
- Source: Department of State, Secretary’s Memoranda of Conversation: Lot 64 D 199. Secret. Drafted by Allen.↩
- On November 10, the government of Prime Minister Ismail al-Azhari was defeated on a motion in the Sudanese Parliament, and al-Azhari resigned. Five days later, however, he was returned to power as Prime Minister.↩