Foreign Relations of the United States, 1955–1957, Arab-Israeli Dispute, 1957, Volume XVII

272. Telegram From the Embassy in Egypt to the Department of State¹

Cairo, April 5, 1957—8 p.m.

3134. Reference Embassy telegram 3125.² Had general review of Egyptian position today on basis comparative American and Egyptian texts in Department telegram 3238.³

As previously reported, Fawzi agreed term document “declaration” instead of “memorandum”. He also agreed first three articles of Egyptian draft not part of declaration proper but, instead of incorporating announcement, he thinking of using as preamble.

Six principles: see Embassy telegram 3117⁴ and 3125. I asked if Fawzi had considered any way in which reference to six principles could be qualified so as to meet GOE objections, such as for example referring also to SYG letter of October 24. Fawzi said had done so and nothing seemed satisfactory in view of what formally on record (by British and French) contrary to GOE’s interpretation. However, if we had any further ideas he would welcome.

Comments on specific articles using numbering of American draft.

1. Use of phrase “will respect” could indicate have not been respecting in past; would prefer phrase such as “continue to respect”.

2. No difference.

3–A. Agreed insertion “or this declaration” here and elsewhere in

3–B. Agreed insertion “or application” but found concluding underlined portion beginning “and Egypt” unacceptable because so far unable find formula for acceptance our proposal re adherence.

4. Use of “undertake” acceptable in principle since idea of obligation recognized. This matter language.

4–A. No difference.

4–B. Egyptian formulation preferred because believed one percent increase without negotiation is reasonable. Re specifying that representation of user should be determined by UN, GOE fully recognizes it is in its own interest that users be organized in some appropriate way since otherwise tolls could not be raised but GOE does not feel it has right to say how this should be done, either through UN or otherwise; that is responsibility of users themselves. Admitted problem is difficult one and solution imperative but GOE cannot see its way clear to taking any other position. It would however welcome other ideas.

4–C. US amendment not acceptable because users would be given final authority in programming with result they could paralyze improvements and introduce politics into Canal matters. Also question of principle, i.e., of giving outside interests power of excessive interference (see Embassy telegrams 3117 and 3125).

5. No difference.

6–A and B. No difference.

6–C. See Embassy telegram 3125.⁵

7. See Embassy telegram 3125.⁶

8–A, B and C. No objection.

8–D. Not acceptable because individual firms as well as representatives of users might desire exercise right; because difficult give right to user representatives when not known what form representation will take; and because, as matter of principle, could not admit right of investigation any more than a foreign shipping company could assert right to investigate equipment or records of New York Port Authority. On other hand users could properly assert right to witness investigations in which they might be interested and to have access to own ships in Canal. Basis for Fawzi’s somewhat spirited rebuttal on this point came out toward end of discussion when he related it to single exception which he had taken in his letter of November 2 to SYG’s letter of October 24 re punitive measures.

8–E. Fawzi preferred Egyptian draft so, he said, as avoid being obligated to consult with unpredictable number of users and get bogged down in endless discussion.

9. Preferred first paragraph as proposed by GOE. Agreeable to American draft of second paragraph but dropping last line. Prefer Egyptian in third paragraph with part of suggested American insertion reading “in accordance with Article 102 of the Charter”.

In following this somewhat formal approach, Fawzi and I agreed we were not, of course, seeking produce a negotiated document but rather to use comparative texts in Department telegram 3238 as means checking and supplementing Fawzi’s comments as reported Embassy telegram 3125. Fawzi said he also wished make clear that points on which he had felt unable accept our suggestions represented real problems for GOE and were not positions taken for tactical purposes. He would continue ponder them but at same time he earnestly hoped we would have another look at them with view to seeing whether the Egyptian position may not be found reasonable and if not with view to furnishing further suggestions which might help surmount difficulty. He indicated time somewhat limited and hoped our further views might be received as soon as possible.

I said desired be helpful as possible but could not but note that US suggestions which GOE prepared accept seemed somewhat limited as compared with those they found unacceptable. In view of stress on urgency, I would have hoped area of agreement could have been greater. It was not very encouraging. Fawzi said he definitely did not feel occasion was one for pessimism. We had talked frankly and appeared be heading in same general direction. He was hopeful that, out of this, agreement would emerge.

Comments in subsequent telegram.

Hare

1. Source: Department of State, Central Files, 974.7301/4–557. Confidential; Priority. Received at 11:30 p.m.
2. Telegram 3125, April 4, transmitted a report on Hare’s April 4 conversation with Fawzi concerning the Egyptian draft declaration. Fawzi repeated Nasser’s criticisms of the U.S. proposals (see telegram 3112, Document 270), and made specific objections to paragraphs 4 (C), 6 (C), and 7. (Department of State, Central Files, 974.7301/4–457)
3. Document 255.
4. See footnotes 4, 5, and 6, Document 270.
5. In telegram 3125 from Cairo, April 4, Hare reported, regarding paragraph 6 (C), that Fawzi objected to the specification that development funds should be deposited in the Bank for International Settlement. Fawzi explained that Egypt was prepared to obligate itself to devote 25 percent of the gross receipts for that purpose, but to insist on depositing it in an “outside” bank could only imply that Egypt was not to be trusted to carry out its declaration. (Department of State, Central Files, 974.7301/4–457)
6. Regarding paragraph 7, Hare reported in telegram 3125 that Fawzi objected to the U.S. stipulation that the Canal Code could not be changed except with agreement of the users.