52. Telegram From the Embassy in Egypt to the Department of State1
1439. For Assistant Secretary Allen, NEA. Black conversations encountered heavy going today as yesterday primarily due GOE’S repeated insistence need for signed loan agreement covering entire project. This Black refused time and again although he offered exchange of unilateral declarations of intentions. Meeting terminated with Black making clear useless continue conversations on subject overall loan agreement. Kaissouni indicated whole matter might have to be referred to Cabinet and Black might be asked to see Nasser. Black told me afterwards he felt sure now GOE did not want to see him break off these talks and go home. Of interest was fact Helmy did not participate today’s session.
Underlying problem here seems clearly to be political and while I cannot at this point sort out all cross currents behind Egypt’s attitude, we all agree one ingredient is Egypt’s fear Bank likely to back out later if conditions brought Egypt into arms race with resultant heavy pledging of Egyptian resources to unproductive uses. I therefore think it would be of great help if I could pass word to Nasser that Secretary has in effect turned down sine die Israel’s arms request. I need not go into details Deptel 16742 and can state case in any words you elect. Result in my opinion would be to relax Egyptians somewhat and permit them to look at Bank’s conditions with more balanced viewpoint. Urgent reply requested.3
- Source: Department of State, Central Files, 874.2614/1–3056. Secret; Niact. Received at 4:56 p.m.↩
- See footnote 2, Document 38.↩
- Allen responded negatively to Hart’s suggestion to pass information to Nasser, on the grounds that “Israeli request may be reconsidered at any time, depending in part on outcome various conversations now going on in Cairo.” (Telegram 1720 to Cairo, January 31; Department of State, Central Files, 874.2614/1–3056)↩