205. Memorandum of a Conversation, Department of State1

SUBJECT

  • Suez Canal

PARTICIPANTS

  • Sir Roger Makins, British Ambassador
  • J.E. Coulson, Minister, British Embassy
  • The Secretary
  • Herman Phleger, Legal Adviser—L
  • William M. Rountree, NEA

Ambassador Makins began by saying that in the messages which he had just received the British Government had expressed its gratitude for the Secretary’s efforts. He handed to the Secretary a letter dated September 102 setting forth several messages from London. He said that, in brief, London agreed with the Secretary’s proposal for the Canal users organization but was up against an extremely tight time schedule because of the meeting of Parliament.

The Ambassador said that importance was attached to the proposed letter informing the President of the Security Council of the Suez situation, but the British Government regarded that as a compliment to announcing the users association. They hoped the letter would be signed by the United States, as well as by the British and French, and the Ambassador said he would communicate later with the Secretary on this point.

[Page 470]

Regarding the detailed users association plan, the Ambassador said he assumed that there was no question that the proposal would not be negotiated with Egypt but that the latter would merely be informed. Also, the British Government assumed the adoption of the plan would not involve recognition of the validity of the Egyptian nationalization decree. The Secretary said that he concurred and pointed out that the latter point had been made clear in the preamble of his paper setting forth the plan.

The Ambassador said the British Government would like the composition of the proposed Executive Committee to be the same as the Five-Man negotiating committee which was recently in Cairo, with the addition of the United Kingdom and France. Continuing, he said the British assumed that the users association would be a legal entity, that it would be organized as soon as possible and that it would have a bank account. The Secretary said that his own plan contained a provision for a bank account. Regarding the question of the legal basis of the organization, he wondered whether the international status would not be lost if the association were incorporated. The act of incorporation must be under the laws of some state, and it would seem to him that there were real disadvantages to doing that inasmuch as to have maximum power, the group should act as nations and not as a mere corporate body. Mr. Phleger observed that the organization might be considered to be in the form of an international partnership. The Secretary felt we should avoid giving the organization the role of private citizen. In any event, it could act as an entity and the Administrator could carry out appropriate functions including depositing and drawing out funds established in an account at his disposal.

The Secretary said he had met earlier this morning with the French Ambassador and had emphasized to him that when the plan went into effect and the Canal tolls were denied to the Egyptian Government, it was possible that ships would be denied passage. In this event, there would be substantial economic consequences. Ambassador Makins observed that if ships were denied passage, it would be the intent to take the matter to the Security Council and, under the circumstances, he assumed the United States would stand by the British and French. He asked the Secretary to confirm his understanding. The Secretary said that certainly in principle the United States would stand in back of them but, of course, we would not know what relief they would seek. The action requested of the Security Council was, of course, an important consideration.

The Ambassador reverted to the fact that the British were acting under time pressures. If they avoided taking the matter to the Security Council and adopted the alternative proposal of the users association, the Prime Minister felt that to hold his position he [Page 471]would have to say something along the lines set forth in the letter of September 10 which the Ambassador had just handed to the Secretary. He inquired whether the Secretary approved the substance of that statement. The Secretary said that the wording of the statement was not clear in certain respects. It might be implied from one point that the United States, in agreeing to the wording, would also agree to joining in military action. Of course, we would not want any misunderstanding in that regard. The Ambassador thought the Secretary would question that portion of the statement, and said that he himself did not know exactly what was meant. Mr. Phleger observed that it seemed to imply that the US, UK and France had decided physically to take over the Canal by any means.

The Secretary thought the statement might also be more clear regarding payments which might be made to Egypt. He felt that Egypt should, as a minimum, be reimbursed for out-of-pocket expenses.

The Secretary said that before giving the Ambassador his considered reaction to the statement suggested by the Prime Minister, he would like to talk with the President. He would try to do so as soon as possible so that he could give an early reply to the Ambassador. The Ambassador said that if he could have his observations by noon the following day, adequate time should be provided to communicate to Mr. Eden.

The Secretary stated that the Ambassador had earlier made the remark which he wished again to comment upon. We had never opposed going to the United Nations; although we had pointed out what we thought were serious impediments to bringing the matter before that body in the form which had been suggested by the British. He had also pointed out that we could not agree in advance to oppose any appeal which might be made by other countries in the United Nations not to resort to force. He thought the decision not to take the matter to the Security Council was entirely one for the British to make, although he thought it incumbent upon him as a friend to state his reaction to the British proposal.

Ambassador Makins said that it would be dangerous to go to the United Nations unless the British had complete American support in all circumstances. Since the Secretary had been unable to give this assurance, his Government felt that the alternative which the Secretary had put forward should be adopted.

The Ambassador stated that the Foreign Office had informed him that the Canal pilots were at the end of their rope and the British Government did not think it was possible to hold them against their will. They thought the best way of keeping the pilots was to make an announcement regarding the users association as [Page 472]soon as possible, and it was believed the pilots would be available for employment with that agency.

The Secretary inquired whether the Ambassador had heard from London regarding the British position on the question which he had raised about possible economic consequences of denying Canal tolls to Egypt or diverting tankers from passage through the Suez Canal. He pointed out that the users association program involved the British and the French facing up to this problem. The Ambassador said he had as yet received no answer to his communications in this subject. He hoped to receive further elucidations before meeting with the Secretary the following morning.3

  1. Source: Department of State, Central Files, 974.7301/9–1056. Secret; Suez Distribution. Drafted by Rountree. The time of the meeting is from Dulles’ Appointment Book. (Princeton University Library, Dulles Papers)
  2. Infra .
  3. At 7 p.m. September 10, Dulles telephoned President Eisenhower. Their conversation on Suez, as transcribed by Asbjornson, went as follows: “The Sec telephoned the President and said he had just seen Makins, who had left a letter with him [ infra ] and which the Secretary said he would send to the President this evening. (This was done.) It relates to the position Eden wants to take when he addresses Parliament on Wednesday [September 12]. On the whole, it is encouraging and is along the lines suggested in your letter [ Document 192]. The Sec said that on the whole what he wants to say goes somewhat too far. The Sec said he would be working tonight on some alternative suggestions. The Sec said he had a meeting set up with the President for 10:45 tomorrow morning saying he had promised Makins a reply by noon tomorrow. The British had to make some pretty critical decisions. The Sec said he thought Makins would want to turn these things in the letter over in his mind.” (Eisenhower Library, Dulles Papers, White House Telephone Conversations)