257. Memorandum of a Conversation, Secretary Dulles’ Residence, Washington, March 30, 1957, 11:30 a.m.1


  • Egyptian Memorandum on the Suez Canal


  • Ambassador Harold Caccia, British Embassy
  • Mr. Hoyer-Millar, Permanent Under Secretary of State, Foreign Office
  • Mr. Ronald Bailey, Counselor, British Embassy
  • The Secretary
  • Mr. Dillon
  • Mr. Phleger
  • Mr. Rountree

Ambassador Caccia said he had received London’s reaction to the Egyptian memorandum on the Suez Canal, copy of which had been given him by the Department on March 27. He handed the Secretary the attached paper summarizing points made by the Foreign Office. (Attachment A)

The main discussion of the British paper centered on Point 6. In response to the suggestion that it was highly unlikely that the “Four Power proposals” were now possible of achievement, the Ambassador explained that London had no unrealistic hopes regarding those proposals. [Page 493] He thought that what the Foreign Office had in mind was that some interim arrangements perhaps should be considered, since a final settlement would take time.

Ambassador Caccia said that London was considering taking the matter again to the Security Council if satisfactory arrangements were not made with Egypt, although it was recognized that this would be little more than “a sign of protest”, knowing that the Soviets would veto any practical suggestions in the Council. Mr. Dillon commented that he had discussed that morning with the French2 what might be done if Egypt should go ahead with canal arrangements unsatisfactory to the users. The French thought that the matter should go to the Security Council immediately, possibly Monday, although Mr. Dillon had pointed out that it probably would not even be known by Monday whether the Egyptians would be willing to modify substantially their memorandum. He said the French also attached importance to paying dues through SCUA, with the “double blockage” of Egyptian accounts.

Mr. Hoyer-Millar expressed the view that the matter should not be taken to the Security Council while the United States was asking the Egyptians to negotiate.

The Secretary showed the British officials a draft communication which he had prepared for Ambassador Hare to use with the Egyptian Government.3 He said that he had not had an opportunity previously to discuss that draft with his own colleagues but he would appreciate any reactions which the British might have.

Ambassador Caccia and Mr. Hoyer-Millar commented favorably upon the paper. They suggested that it be made clear we would not accept the unilateral aspect of the Egyptian proposal, and also that it be made clear that the United States wished to undertake talks with the Egyptians. Mr. Hoyer-Millar also suggested that the last part of the draft, setting forth arguments why Egypt should make arrangements satisfactory to the users in order to avoid the bypassing of the canal in future years, might more appropriately be made orally rather than in the written communication. He questioned whether the arguments would in fact be persuasive to Nasser.

The question of procedures was discussed generally, the consensus being that while a meeting should be held with all members of SCUA, the time element was such that the United States should proceed without awaiting such a meeting. Moreover, while the Executive Council of SCUA might be informed in Washington at once, even that should not delay instructions to Ambassador Hare.

[Page 494]

The Secretary said that we would like to keep in touch with the United Kingdom as the situation developed, and we would like to do whatever was courteous and productive with respect to other interested countries. However, the situation required immediate action and this broader consultation, though highly desirable, was not practicable in advance of each decision. Even with respect to the British, we would have to ask them to give us considerable freedom of action within the general framework of our understanding as to what we both sought with respect to arrangements with Egypt. We must act quickly, and we will do that if the British did not object. We did not want to have SCUA or any of our friends think that we were working behind their backs. We would bring representatives of the SCUA Council nations in touch with the situation the following day.

Mr. Hoyer-Millar agreed with what the Secretary had said. It was important that the Secretary should move with speed and flexibility. He thought it was an excellent idea to meet the following day with the SCUA Executive Council to keep the members informed.4

Ambassador Caccia mentioned that the Prime Minister would have to make a statement on Tuesday regarding his talks at Bermuda. There were two questions which he would have to answer specifically. The Ambassador showed the Secretary a draft of what the Prime Minister planned to say on these two questions and the Secretary said that the statements were “admirable”. (The reporting officer, not having seen the statements, does not know their subjects.)

Ambassador Caccia handed to Mr. Phleger a paper raising a question concerning the registration with the United Nations of the Egyptian memorandum. (Attachment B)5 He asked for Mr. Phleger’s comments, which the latter undertook to give.

[Page 495]

Attachment A

Note From the British Embassy to the Department of State

We agree that we must now get to grips with Egypt directly. Only the United States Government are in a position to do this effectively and we hope they will act as soon as possible through their own Ambassador in Cairo.
Whether or not he should say he is acting for other Governments as well as for the United States is a question which we would leave to the United States.
We agree that the object of the approach should be to draw the Egyptians into negotiations. But we must make it clear that neither we nor the United States will be satisfied with an unilateral declaration which would run counter to the Security Council resolution of October 13 and subsequent exchange of letters of October 24 and November 2 between the Secretary General and Dr. Fawzi, in which the latter spoke of negotiations. There must be some form of international agreement or treaty.
It is perhaps impossible for the Egyptians to withdraw their draft declaration, since it is already public knowledge. But at the least could they not explain that it was put forward for discussion? We for our part would be prepared to discuss it on the basis of
the resolution of October 13
Mr. Hammarskjold’s letter of October 24.
We would see no objection to the United States indicating that a satisfactory outcome of negotiations on this basis would be followed by some relaxation of economic pressure by the United States.
The proposed negotiations would be for a permanent settlement and an agreement to start them would therefore raise again the question of interim arrangements. Here we should begin with the Four Power proposals.
In the absence of a settlement we hope that Mr. Dulles will be prepared to put into effect his proposal for the double blocking of Egyptian balances.
We agree that consultation with representatives of the members of the SCUA executive in Washington would be a good move. But it will not of course relieve the pressure for a Council meeting in London in the fairly near future.
  1. Source: Department of State, Central Files, 974.7301/3–3057. Confidential. Drafted by Rountree.
  2. A memorandum of the conversation by Shaw is ibid.
  3. Not printed. (Ibid.) Subsequently, an amended version was transmitted to Cairo in telegram 3253, infra.
  4. On March 31, Dillon met with representatives of those governments belonging to the SCUA Executive Committee (France, Iran, Italy, Norway, and the United Kingdom) and informed them of the U.S. belief that the Egyptian memorandum could be changed into a satisfactory instrument with a relatively small number of important alterations. Dillon told them that the United States was informing Egypt of its views and explained that although time did not allow a joint reply with other SCUA members, the United States would keep the others informed concerning the progress of negotiation. (Memorandum of conversation by Shaw, March 31; Department of State, Central Files, 974.7301/3–3157)

    On April 2, the Department of State authorized the Embassy in London at its discretion to arrange for an early meeting of the SCUA Council in order to inform the members of U.S. views and actions concerning the Egyptian draft memorandum. (Telegram 6914 to London, April 2; ibid., 974.7301/4–257)

  5. Not printed.