322. Memorandum of a Conversation, New York, October 10, 19561
SUBJECT
- Suez Canal
PARTICIPANTS
- US Side
- The Secretary
- Mr. William Rountree
- (The Secretary joined the conversation briefly at one point)
- Israel
- Ambassador Eban
- Mr. Shiloah
Ambassador Eban said he had several matters to discuss with me. First was the proposed statement drafted by the Export-Import Bank in connection with the Israel application for a loan to finance water development work in Israel.2 He said the statement as drafted gave no indication that the Bank had made a decision in principle to finance the project, and thus would probably do more harm than good. He earnestly hoped that wording could be added to the effect that, subject to the findings of the Mission, the Bank was prepared in principle to assist in financing the program.3
I told the Ambassador that the matter had been discussed earlier in the day with Mr. Waugh and that since the Bank had not made such an affirmative decision Mr. Waugh felt that the statement could not be amended as suggested. However, we hoped that it might be possible to add to the statement in some manner to make it more attractive from the Israeli viewpoint, but that the matter was one for decision by the Bank. I had understood that Mr. Waugh [Page 683] intended telephoning the Ambassador that afternoon to discuss alternative wording, and I suggested the Ambassador get in touch with Mr. Waugh to pursue the matter with him.
The Ambassador then referred to the Security Council consideration of the Suez Canal problem. He said he had read the Secretary’s speech4 with great interest and admiration. He had noted the emphasis which the Secretary had placed upon the necessity for insulating the control of the traffic from the politics of any one country. The Secretary had not, however, mentioned specifically the Egyptian refusal to permit transit of Israeli vessels. Because of the juridical background of this case and the fact that the denial of Israeli traffic was in fact the one concrete violation of the 1888 Convention, the Israeli Government would greatly appreciate it if the Secretary would seek an opportunity during the course of the Council deliberations to mention specifically the Israeli case. The Secretary joined the group at this point5 and told the Ambassador that he would bear his request in mind and would try to make an appropriate statement if a satisfactory occasion presented itself, which he hoped it would.
The Secretary referred to previous conversations which he had had with the Ambassador concerning the Israeli request that their representative be heard by the Security Council. He had talked with Mr. Pineau, President of the Council, and had expressed the hope that the Israeli request could be met. The Secretary suggested that the Ambassador get in touch with Mr. Pineau to pursue the matter. (At this point the Secretary departed from the meeting.)
Ambassador Eban said that after the recent discussions in Tel Aviv and Washington concerning plans for Iraqi troops to be sent to Jordan, several disquieting events had occurred. First was the indication that the United Kingdom supported an Iraqi proposal that the Arab-Israel dispute be settled on the basis of a compromise which would be very much at Israel’s expense. The proposal contemplated use of the 1947 UN Resolution, which would truncate Israel and would do serious damage to the only outpost of Western democracy in the Near East. The second development was an indication that the force would not be entirely temporary but would be the beginning of a movement for the annexation by Iraq of Jordan. He said that as a result of these developments Israel had considerable misgivings and wished to discuss the matter further before formalizing any agreement not to object to the movement of Iraqi troops. I told the Ambassador that on the basis of previous conversations which we [Page 684] had had, some steps had already proceeded. I understood that conversations were going on in Tel Aviv between Ambassador Lawson and the Israeli Government, and also that the British Embassy was to discuss the matter with the Government. I would, of course, take note of his comments. I earnestly hoped that in view of the great importance of stability [in] the situation in Jordan, and of reducing Egyptian influence in that country, the Israel Government would agree to the wisdom of having Iraq move as planned within the limitations which had previously been set forth and which had been communicated to the Iraqi Government.
- Source: Department of State, Central Files, 974.7301/10–1156. Secret. Drafted by Rountree. The source text is incorrectly dated October 11; the chronology prepared by the U.S. Delegation indicates that this conversation took place on October 10. (Ibid., Conference Files: Lot 62 D 181, CF 797)↩
- The text of a proposed Export-Import Bank press release is attached to a memorandum from Joseph Palmer II to Hoover, dated October 9. The press release contains the announcement that the Export-Import Bank was planning to send a Mission to Israel about the end of October in conjunction with its study of an Israeli proposal to supplement and expand Israel’s land development program. The press release also noted that an on-the-ground examination of existing projects and potential resources for further land development was a normal procedure for the Bank. (Ibid., Central Files, 884A.10/9–2956)↩
- During a telephone conversation on October 11, Samuel Waugh informed Dulles that the Board of the Export-Import Bank refused to change the statement, as requested by Eban. (Memorandum of telephone conversation by Bernau, October 11; ibid., 103-XMB/10–1156)↩
- See footnote 2, Document 317.↩
- According to Dulles’ Appointment Book, the Secretary joined this conversation at 3:55 p.m. and left at 3:59 p.m. (Princeton University Library, Dulles Papers)↩