Foreign Relations of the United States, 1955–1957, Suez Crisis, July 26–December 31, 1956, Volume XVI

17. Telegram From the Embassy in the United Kingdom to the Department of State ¹

London , July 28, 1956—2 p.m.

516. Cairo eyes only Ambassador. Paris eyes only Ambassador. Department pass Secretary. For the Acting Secretary.

1. Reference Embtels 481 and 510.² Caccia (Acting Head of Foreign Office in Kirkpatrick’s absence on holiday) sent for French Ambassador and met this morning to review latest developments on Canal problem.

2. Chauvel informed us that he had just had word from Paris that France could make available certain naval units if they were needed. He said the details were being communicated to the Department through the French Embassy at Washington.³

3. Caccia said that, as we had seen in the newspapers, HMG had issued orders last night freezing the Canal Company’s assets in the United Kingdom. Details to be communicated to Department through British Embassy Washington.⁴

4. Caccia said masters of British vessels had been instructed pay Canal tolls on the spot if Egyptian authorities insisted, since HMG considers it essential keep Canal traffic moving.

5. We discussed Canal Company’s present orders to its personnel in Egypt which are in substance that (1) they should consider themselves as remaining under the orders of the original company and not of the Egyptians, (2) they should avoid anything which [may] be construed as sabatoge of transit of the Canal, and (3) if they have to follow orders given by the Egyptian authorities, they should do so under protest.

6. Caccia said that he had seen the Italian Ambassador this morning and had been surprised over latter’s apparent unawareness gravity situation. He had taken opportunity to impress upon the Ambassador the very serious consequences—not least for Italy—which might flow from Nasser’s seizure of the Canal.

7. Caccia said that as result Cabinet meeting last night HMG was now even more firmly of the view that in the last resort the West would have to take military measures to maintain the Canal as a free international waterway (fifth para Embtel 510).

8. Caccia and Chauvel said that their Governments feel it essential broaden basis consultation soonest at tripartite meeting and reached its conclusions [sic], I said I had received indication Washington agreed. Caccia added it was now necessary and urgent that three Governments should compile list of those to be brought into consultation. His preliminary view was that list of signatories 1888 Convention no use nor was list of mail users of Canal.

9. As to forthcoming tripartite meeting, I said that Murphy had been designated and would arrive Sunday evening or Monday morning. I also mentioned Minister Barbour’s⁵ return Monday morning. Caccia expressed strong hope that Murphy might possibly take a plane tonight so as to be in London in time for meetings to start Sunday evening (eighth para Embtel 510). I promised phone Murphy immediately but said I doubted he could start for London before Sunday since I assumed he would need at least minimum time for briefing before departure.

10. Chauvel said Pineau, who arrives Sunday, had planned to stay through Monday but he thought could remain here Tuesday if necessary; feared Pineau would have to return to Paris not later than Wednesday morning.

11. Caccia said HMG now considered that attendance military advisors at tripartite discussion might be desirable after all though HMG had not reached definite decision on this (tenth para Embtel 510). (I have alerted Admiral Boone to possibility he may be needed here and he has cancelled trip which he planned to take to the Mediterranean starting Monday. I have also given him full background on developments to date. My own view Admiral Boone could be substantial assistance to Murphy even if military advisors do not formally attend discussions.)

12. Finally, would recall that Randolph Burgess on holiday in England and had planned to stay here till August 10. In view several financial aspects Canal problem Murphy might find his advice and assistance valuable. I have not been in touch with Burgess about Canal problem but could easily do so if Department and Treasury desire. He is presently visiting in East Anglia.

Foster

1. Source: Department of State, Central Files, 974.7301/7–2856. Top Secret; Niact. Received at 3:18 p.m. Repeated to Cairo and Paris.
2. Documents 2 and 7.
3. Not found in Department of State files.
4. On July 28, the Counselor of the British Embassy, Ronald Bailey, telephoned the Department of State to explain that the British Government had that day effectively blocked all Egyptian sterling assets by these measures: “(1) Regulation 2. A has been used to block the whole of the Suez Canal Company’s assets in the United Kingdom. Sterling balances, sterling security, etc. (2) Steps have been taken to exclude Egypt from transferable account arrangements thus making her a ‘bilateral’ country. (3) No payments to or from Egyptian accounts are being allowed with the exception of authorized payments from the sterling area to Egypt.” (Copy of an unsigned typewritten memorandum; Department of State, L/NEA Files: Lot 64 D 290, Suez Canal 1947–1959) In parentheses below the quoted message is the typed inscription: “In other words, payments are allowed under license.”
5. Deputy Chief of Mission in London, Walworth Barbour.