394. Telegram From the Embassy in Egypt to the Department of State1

2470. We speculate ShepilovNasser talks during former’s visit Cairo2 will include:

Financing of High Dam (Embtel 24383).
Palestine question: This might involve Egyptian effort obtain Soviet undertaking that if latter finds it necessary become involved in efforts develop Arab–Israeli settlement Soviets will insist such discussions take place under UN auspices with GAA resolutions as point of departure.
Soviet–Egyptian friendship treaty: From several sources we have heard speculation that this subject might be discussed. One source has suggested initiative this subject comes from Egyptians who might be seeking less expensive “guarantee” against Israeli attack than arms imports. Source understands Soviets have dragged feet believing such treaty would provoke violent Western reaction. [Page 726] We inclined believe that GOE thinking on this subject (which at first glance seems inconsistent previous GOE views on non–Arab “pacts” not yet crystalized. Proposed Nasser visit Tito4 might indicate Nasser desires discuss developments along these lines with man who best knows problems which would be involved.

Current GOE belief West unprepared and probably unwilling cooperate with Egypt probably another factor in development atmosphere favorable increased cooperation with Soviet Bloc.

  1. Source: Department of State, Central Files, 033.6174/6–1256. Secret. Received at 5:04 p.m. Repeated to Moscow, London, Paris, Alexandria, Amman, Bahgdad, Beirut, Benghazi, Damascus, Jidda, Khartoum, Port Said, Tel Aviv, and Tripoli.
  2. Shepilov arrived in Cairo on June 16 and left for Damascus on June 22.
  3. Telegram 2438, June 8, reported: “Soviets are now exerting strong pressure on Egypt to conclude High Dam deal… . Soviet offer now totals 450 million dollars worth equipment credits payable in cotton over 30 year period at 1 and 1/2 percent interest and Soviets are offering complete dam within 6 years.” (Department of State, Central Files, 874.2614/6–856)
  4. Nasser visited Yugoslavia July 12–19.