In Cairo recently the Under-Secretary of State for Planning in the UAR Government handed the Canadian Ambassador a memorandum which proposed that Canada might contribute to the UAR's economic development by providing assistance in training UAR students and more senior officials of the UAR Government in Canada.

2. The UAR memorandum, which is reproduced in Telegram No. 629 of July 31? (copy attached) proposed two kinds of training. The first would be for graduate students interested in proceeding to Master's or Doctor's degrees in economic statistics, business management, industrial organization and other related fields of study in Canadian universities. These students would be granted UAR Government scholarships. It was envisaged that there might be an annual flow of about 15 students to Canada under this training scheme.

3. The second kind of training envisaged was short training courses (not more than a year in duration), for more experienced officials of the UAR Government and would cover generally the same fields of study as the first kind of training. This second type of training would differ from the first in two respects. It would be obtained partly through Canadian Government de-partments or agencies whose work is concerned with economics and statistics, through special courses (presumably at educational institutions), through visits to Canadian cities and develop-ment areas, and through discussions with responsible Canadian authorities at different levels of government. The other difference is that although officials selected for this second type of training might travel at the expense of the UAR Government, it is contemplated that their training might be financed through UN fellowships, or other unspecified arrangements. In an explanatory telegram (No. 628 of July 31, 1959,? copy attached) Mr. Smith raised the possi-bility that Canada might consider it a worth-while gesture to make a few technical assistance scholarships available for this second kind of training. It was contemplated that from four to six officials might be trained annually in Canada under this second kind of training.

4. In support of these proposals, Mr. Smith advanced these arguments:

(a) It would serve Canada's political interests to encourage the flow of UAR trainees to centres in the North Atlantic community. However, the UAR is reluctant to rely too heavily on the UK or the US, both of whom they regard as "imperialists," or on France, for broadly similar reasons;

(b) Canada has an interest in encouraging the use of English and French as effective international languages;

(c) The presence of UAR students in Canada on a continuing basis might be expected event-ually to improve trade relations between the two countries because training in Canada would create a knowledge of and a predisposition towards goods and materials produced in Canada.

5. The Secretary of State for External Affairs approved the two types of training proposed by the UAR authorities, and asked that action be taken to make the necessary arrangements. Mr. Green's approval was given on the understanding that Canada would make no financial contribution to either of the two kinds of training proposed by the UAR.

6. In the meantime, there has been a significant political development which throws a completely different light on the UAR's original proposals and which has given rise to proposals quite different from those initially put forward (Telegrams Nos. 724 of August 28? and 727 of August 29,? copies attached). Mr. Smith has been informed, at the request of President Nasser, that the UAR Government has decided to transfer from the USSR to Western countries (primarily Canada, the UK and US at the outset) the training of the several hundred students who must be trained annually to foster the UAR's economic development. This decision reflects a significant development in UAR policy and is based on the UAR's growing disillusionment with the Communist bloc. The immediate reasons for the decision to transfer the training of students to the West was an "investigation" of several hundred USSR-trained students who had been instructed to return to the UAR on leave this summer. This "investigation" revealed that the students had not been properly trained technically, but had been indoctrinated as Communists and in some cases trained for subversion. Political rather than academic standards had been applied by USSR authorities in grading the UAR students. The UAR Government considers that the USSR-trained students will be economically useless to their homeland - some may even have to be imprisoned. President Nasser has decided to send no more UAR students to the USSR, and probably to the satellite countries.

7. The UAR Government has approached the representatives of Canada, the UK and the US in Cairo to ask whether these countries could lend assistance by way of providing places for UAR students in western educational institutions, primarily in technical faculties. The UAR authorities expressed the hope that Canada might be able to find places this autumn for as many as possible - "say about one hundred." A few of these students would study languages, but most would study engineering, geology and natural sciences etc. The UAR hoped that the UK and US each might be able to take about 200 students.

8. The UAR authorities indicated also that they would like Canada to provide about 50 professors and lecturers to teach chiefly technical subjects at UAR universities. Although no difficulty is contemplated in paying adequate salaries to foreigners, the UAR is "desperately" short of dollars and has enquired whether Canada could provide funds to finance from 30 to 40 scholarships, perhaps by something analogous to Colombo Plan technical assistance fellowships. The UAR authorities have stressed that the problem of finding places in Canadian universities for UAR students is quite distinct from the problem of financing scholarships out of Canadian funds.

9. The UAR has requested a reply from the Canadian Government urgently on whether or not Canada would be willing in principle to assist the UAR with its problem, particularly by making places available in our universities.

10. Our Ambassador in Cairo has recommended strongly that Canada support the UAR in this matter, and has reported that the UK and US Ambassadors had submitted the same recommenddation to their governments. Mr. Smith gave these reasons in support of his recommendation:

(a) Nasser's swing away from his previous close relations with the USSR already has had important repercussions in other neutralist countries in the Afro-Asian world and the signif-icance of the prospective switch of the flow of UAR students to the West will not be lost on governments in Asia and Africa;

(b) This matter is of obvious importance in the cold war context, since the West has a long-term positive interest in training UAR students;

(c) It is in the West's interest that the UAR's economic development programme should succeed because its success is one essential factor in diminishing the dangerous instability of the Middle East and increasing its capacity to resist communist penetration.

11. Mr. Smith emphasised the importance of an early and favourable reply in principle, pointing out that such an answer might serve to set the UAR more firmly on its new direction of policy and that any time lost would permit the USSR to recoup its losses.

12. Since the UAR Government has asked for a Canadian reply in principle as a first step, Mr. Smith suggested that (a) our initial reply might emphasize our sympathy with the UAR's problem and our willingness to examine carefully the ability of Canadian universities to find places for UAR students. A favourable initial reply, Mr. Smith suggested, would put Canada in a better position to deal with the UAR on any difficulties their requests might raise for us. (b) That the possible provision of scholarships be treated separately, in order not to delay the placing of at least some students in Canada this autumn; (c) That there might be some advan-tage in trying to work out a coordinated programme with the UK and the US at least to deal with the difficult problem of helping the UAR this year.

13. In the light of all these considerations and in the light of Mr. Green's approval of Canadian assistance (short of financial support) for the two types of training initially proposed, the advice of members of the Committee on the following points would be appreciated:

1. Would an immediate favourable reply in principle as suggested by Mr. Smith serve Canada's interests better than any other reply?

2. Would it be desirable and feasible to consider the possibility of providing some financial support (not necessarily large) to the training of UAR students in Canada; possibly in the form of technical assistance scholarships similar to those provided under the Colombo Plan?

3. Would it be practical to think in terms of placing some UAR students in Canadian universities for the coming term?

4. Would these be any prospect at all of providing Canadian professors and lecturers for UAR universities?

5. Would Canada's approach to the UAR's request be assisted by attempting to coordinate any Canadian programme with the UK and US programmes?

NOTE: This paper is based on the following telegrams from Cairo, copies of which are attached:
No. 628 July 31?
629 July 31?
724 August 28?
727 August 29?

It will be noted that we have been asked to guard with special care the information on the training of UAR students in the USSR, on the "investigations" conducted by the UAR authorities and the decision of the UAR to switch student training to the West.