99. Memorandum of a Conversation, Ambassador’s Residence, London, August 19, 1956, 10 p.m.1

USDel/MC/49

PARTICIPANTS

  • The United States
    • Secretary Dulles
    • Ambassador Aldrich
    • Ambassador Dillon
    • Mr. Phleger
  • The United Kingdom
    • Sir Anthony Eden
    • Rt. Hon. Selwyn Lloyd
  • Later joined by Prime Minister
    • Menzies

SUBJECTS DISCUSSED

  • Suez Canal Problem and the Conference

After dinner at Ambassador Aldrich’s the above (excepting Menzies), joined in a discussion of the Suez problem.

Eden and Selwyn Lloyd joined in a request that the United States act to stop further Canal payments to Egypt. They said the British and Dutch would join in this, with the result that Nasser would be faced with the alternative of permitting free passage through the Canal or closing it up. If he permitted free transit, his position would be unstable. If he stopped the transits the U.K. would then be in a position to act.

[Page 234]

The Secretary replied that the U.S. had frozen more than fifty million dollars of Egyptian Government funds, which is more than adequate to cover any tolls now being paid at the Canal, and that he did not see how the U.S. could issue orders to private companies not to continue payment in their accustomed way. He further suggested that refusal to pay the tolls, followed by refusal by Nasser to permit transit, might well be taken by the public to be a closure justified by the refusal of users to pay dues.

Selwyn Lloyd and Eden then pressed the Secretary for his views as to what would happen next at the Conference. The Secretary said that he thought the Conference should proceed to formulate its views on the problem and obtain a consensus. These views could then be presented for [to] Egypt to ascertain if it would agree to a negotiation for a Treaty to give them effect. If Nasser should reject this suggestion, the matter would then be remitted to the Governments for their consideration of future action. He did not believe that matter to be one for the Conference. If on the other hand Nasser agreed to negotiate, then the Conference might be recessed until the results of the negotiation were ready for its consideration. The Secretary stressed that the views of the Conference should not be presented to Nasser as an ultimatum but as an expression of views to form the basis of a negotiated settlement.

There was then discussion of possible economic sanctions in the event Egypt refused to agree to negotiations. Eden pointed out various measures that could be taken. The Secretary observed that economic measures might not be successful because USSR or other Arab countries might come to the assistance of Egypt.

Premier Menzies then joined the group.

Eden and Selwyn Lloyd stressed the importance from the U.K. standpoint of bringing the matter to a speedy conclusion, either by Nasser’s acceptance of the Convention’s views or by his rejection of them. Delay would be fatal. Eden said he has suspended military preparations during the pendency of the Conference but further action could not be long delayed.

The Secretary said that he had encountered a general feeling that the British public would not support the use of force and that Shepilov had also expressed this view. Eden and Selwyn Lloyd said this view was incorrect. The British public, except the Left-Wing Labor element, was strongly behind the Government; that a recent Gallup poll had shown that two-thirds approved the way in which the Government was conducting this matter. Eden said he had refrained from building up public sentiment for the use of force, but he was absolutely confident that when the chips were down, the Government would have the full backing of the public in any military operation. He said that Gaitskell was in favor of Britain [Page 235]fighting to protect Israel. He felt the British public would be much more unanimous in fighting to protect Britain.

In this connection, Eden at the end of the meeting drew Ambassador Aldrich aside and asked him to assure the Secretary that he (Eden) was completely satisfied that Gaitskell would stand with the Government in the use of force if that should appear to be necessary. This was the second time Eden had made this statement privately to Ambassador Aldrich and asked him to reassure the Secretary.

The Secretary pointed out that public opinion in Britain on that question was of vital importance and in addition world opinion and opinion in the United States must be taken into consideration; that as to the latter, there was certainly at present no opinion that would support the use of force.

There was then further discussion regarding procedure at the Conference. Menzies expressed opinions similar to Secretary Dulles’ regarding the formulation of the Conference’s views and their presentation to Nasser. This should be done so as to avoid the appearance of an ultimatum, but should be designed to bring about a prompt response. He thought a Committee should be named to do this. He, though reluctant, would be glad to serve on it.

There was then discussion regarding a composition of a Committee. Eden and Selwyn Lloyd strongly pressed the Secretary to act on such a Committee. The Secretary said that while he would give the matter consideration, he would not make any commitment on it at this time.

There was some discussion regarding the importance of pilotage in the Canal, Eden expressing the view that the Canal could not be operated without the present pilots. The Secretary said there was some question about this, and inquired whether the hazards of Canal operation were being reflected in increased insurance rates. Eden said he did not know but would look into this.

The meeting broke up about midnight after further general discussion regarding further procedure. Selwyn Lloyd said he felt sure the Indians would put in a proposal on Monday, and that Menon would make a long speech. He then urged the Secretary to introduce his paper on Monday. The Secretary said he was inclined to do this, and would accompany it by an explanatory speech. He also indicated that he might make changes in the draft to accommodate the views of the other Delegations whose views he had asked.

  1. Source: Department of State, Conference Files: Lot 62 D 181, CF 755. Secret. Prepared by the U.S. Delegation, but no drafting officer is indicated.