204. Memorandum of a Conversation, Department of State1

SUBJECT

  • Suez Canal; Canadian Jets for Israel; Israel’s Security; Export-Import Bank Loan to Israel

PARTICIPANTS

  • The Secretary
  • The Ambassador of Israel, Mr. Abba Eban
  • Mr. Reuven Shiloah, Minister, Israel Embassy
  • Mr. Slator C. Blackiston, ME

Suez Canal

Ambassador Eban opened the conversation by saying that he had read the Secretary’s statement2 on the failure of the 5-nation Mission on Suez and that Israel shared U.S. regrets that the Mission had proved unsuccessful. Egypt’s out of hand rejection of the committee’s very reasonable proposals had prompted Israel to draw the following conclusions: 1) the Egyptian action is but another in a long series of anti-Western moves by Nasser; 2) the world should look carefully at the consequences of a Nasser victory coming out of this issue. Increased prestige would cause Nasser to look for new worlds to conquer such as the oil of the Near East, and Israel; 3) Nasser is not invincible, his difficulties are very great. Although Nasser may have caused great difficulties to others, he is also in trouble himself. These difficulties can be exploited. 4) It is not certain that SC action on the Suez case would be helpful. It is [Page 466] believed a majority favoring international control of the Canal could be obtained in the SC but it is questionable whether Nasser would take any greater cognizance of SC action than he has of the proposals of the 5-nation committee. The Ambassador indicated Israel is most interested in not doing anything which would jeopardize its position with respect to the Canal which is so important to it. He sought continued consultation with the Department on the Suez problem in order that Israel might receive the benefit of our advice on this matter.

Israel still seeks written assurances from the U.S. that we support the right of Israel shipping to unfettered use of the Canal. The receipt of such assurances would encourage other nations which Israel has approached on this matter, to give similar statements of support.

The Secretary replied that he shared the Ambassador’s views that Nasser’s action showed a certain lack of responsiveness to world opinion. Nasser is probably more responsive to Arab views than he is to those of other nations of the world. Nasser was actually less responsive to the approach of the 5–nation committee than he had believed. We continue to feel that force should not be used against Nasser since it would set into motion forces and events the end of which could not be seen. We realize that he has many internal problems and that those problems can be exploited to his disadvantage. We have not been sympathetic to the British and French proposals with regard to steps to be taken in the UN against Egypt since we think that these steps would lead to difficulties for the West and might prove a two-edged sword. There is a question whether the SC has the authority to do more than make suggestions for procedural steps rather than substantive recommendations. It is doubtful whether the SC has the authority to force Egypt to make a new treaty along the lines of the 1888 Constantinople Convention. It is, however, quite possible that the British and French may write a letter to the SYG calling his attention to the situation and asking that the matter be put on the agenda of the SC without pressing for early consideration. This step would have certain procedural advantages and very few disadvantages. Israel is one of the countries which should be kept advised of developments and it is hoped that the Israel Embassy will keep in touch with an appropriate person in NE for this purpose. In pressing for a solution to the Suez problem Israel can be confident that the U.S. will endeavor to reach an agreement which will be of benefit to Israel. Ambassador Eban suggested that a tanker either of the U.S., U.K., France or other flag be sent through the Canal with a consignment of oil for Israel in [Page 467] order to test Nasser’s reaction. The Secretary asked Mr. Blackiston to bring this suggestion to the attention of Mr. Rountree.3

Canadian Jets for Israel

The Ambassador expressed his appreciation for U.S. efforts to clarify in Ottawa our position with regard to the supply of Canadian F–86 jets to Israel. The problem now was narrowed down to the Canadian requirement, imposed by a commitment to Parliament, to make a public statement regarding the release of the planes.4 The return of Lester Pearson was being awaited in connection with this matter. Israel would be happy if no statement were made; however, if the Canadian Government feels that a statement is required, Israel feels that now is the appropriate time for the announcement to be made. The Suez affair is for the moment relatively dormant—the Menzies committee has left Cairo and no other meetings are presently scheduled. The Israel Ambassador to Canada broached this subject to the Canadian FonOff this morning. The Secretary asked Mr. Blackiston to look into this matter.5

Israel’s Security

The Ambassador said the mobilizations which have been going on in the Near East are causes of concern to Israel—especially the British and French troop movements to Cyprus and the more recently announced Parliamentary decision of Iran giving the government emergency powers. He noted numerous U.S. statements concerning U.S. determination to support the State of Israel in the event of aggression. The Ambassador asked whether the U.S. could now advise Israel of what steps the U.S. contemplated should aggression occur. The Secretary stated that the U.S. had planned to make a statement on the subject of plans to counter an aggressor in the Near East but Nasser’s nationalization action occurred before the announcement could be made, and since then events have precluded [Page 468] the issuance of the announcement. The Secretary took the opportunity to express his disappointment that the Israel Government had failed to implement the proposals for reduction of tension on the Armistice Lines proposed by the SYG. Ambassador Eban said that in the opinion of the Israel Government those measures are not effective. The Secretary said that he and SYG Hammarskjold felt that Israel was utilizing the present Suez crisis as a means of avoiding taking action on those proposals. The Ambassador stated that Ben Gurion wished for some reciprocity from Egypt, such as releasing of Israel shipping, prior to unilaterally undertaking the steps proposed by the SYG.

Export-Import Loan

The Ambassador said that he understood the Bank had completed its study of Israel’s loan application and that it was in a position to grant the loan if encouraged to do so by the Department. Israel was willing to accept any mission needed to investigate any aspects of the loan.

The Secretary explained that his preoccupation with the Suez matter had precluded his study of a paper6 which he understood had been prepared in the Department on the matter. Asked by Mr. Eban whether he continued to favor the loan in principle the Secretary said that he wished to investigate the matter before giving a definitive answer. Ambassador Eban explained that the Israel Minister of Finance7 was due in the U.S. this week and he hoped to be able to give him some definite news while he was here.

Socony–Vacuum Operations in Israel

There followed a discussion of the Socony-Vacuum decision to terminate its operations in Israel. The Ambassador said it came at a very bad time in view of the Suez crisis. He sought U.S. intervention with Saudi Arabia to halt the Saudi Arabian pressure which had prompted the Socony-Vacuum decision.

Alternative Pipe Line

There was a discussion of an alternative pipeline through Israel and the Ambassador stated that the Israel Government had been in touch with American companies on this matter. The Secretary commented that presumably representatives of these companies would [Page 469] call in the Department to discuss this matter. The Ambassador asked whether Israel officials could be put in touch with a U.S. committee which, he understood, was studying problems which would arise should the Canal be closed and the pipelines cut. He hoped that Israel’s views and proposals could be made known to this committee. The Secretary explained that the committee to which the Ambassador referred was concerned with long-range aspects of the problem and that, therefore, he doubted whether Israel officials would benefit from talking to the committee members.

  1. Source: Department of State, NEA Files: Lot 58 D 722, Israel—Aid & Assistance, 1954–1956. Confidential. Drafted by Blackiston. The time of the meeting is from Dulles’ Appointment Book. (Princeton University Library, Dulles Papers) Three separate memoranda of this conversation cover different topics: “Suez Canal” (ibid., Central Files, 974.7301/9–1056), “Israel’s Defense Needs” (ibid., 784a.5/9–1056), and “Israel’s Economic Problems” (ibid., 884a.00/9–1056). A briefing memorandum for Dulles by Rountree prior to this conversation is ibid., 974.7301/9–1056.
  2. See footnote 3, Document 196.
  3. Attached to the source text but not printed is a memorandum from Wilkins to Rountree, informing the Assistant Secretary of this aspect of the conversation.
  4. On September 4, the Embassy in Ottawa informed the Department of State that the Canadian Cabinet had decided to defer action on the release of the F–86’s to Israel until the return of Foreign Minister Pearson during the latter part of September. The Embassy noted that “principal anxiety was avoidance rocking Suez boat during Menzies-Nasser negotiations.” (Telegram 119; Department of State, Central Files, 784A.5622/9–456)
  5. In telegram 107 to Ottawa, September 11, the Department requested the Embassy to ascertain what the Canadian reaction had been to the Israeli approach concerning the F–86’s. The telegram noted that Eban had sought United States support in this démarche, but that no commitment had been made to him. (Ibid., 784A.5622/9–1156) On September 13, the Embassy in Ottawa reported that the Canadian Cabinet at next week’s meeting would decide to release the airplanes without waiting for Pearson’s return. (Telegram 132; ibid., 784A.5622/9–1356)
  6. Reference is presumably to a memorandum from Prochnow (E) and Rountree to Dulles, dated September 6, on the subject of “Israel Application for Export-Import Bank Loan”. (Ibid., 884A.10/9–656) There is no indication whether Dulles actually saw it.
  7. Levi Eshkol.