Reference: Your Tel ME-126 Jun 2.?
Repeat London (OpImmediate), Permis New York, Washington, NATO Paris, Paris from London (Information).
By Bag Oslo, Delhi, Karachi, Stockholm, Belgrade, Rome, Tel Aviv, Beirut from London.

SUEZ CANAL CARGOES: UNEF AND UAR POLICY IN GENERAL

Your OpImmediate reference telegram has just arrived. Meanwhile we have been preparing progress report on several topics including Canal cargoes but also developments in Cairo's attitudes regarding relations with Iraq,⁵¹⁷ with UK, and with USSR (including plans for high dam).⁵¹⁸ I have recently reported on Gaza Strip situation.⁵¹⁹ The conjuncture of periods of decision in these various fields may I think be most significant factor. With possibility of a further real improvement in Cairo's relations with West, and with need to check trend towards communism in Iraq, this would be an unfortunate time for West, but also for UAR, to have a serious row, whether over Suez cargoes or over UNEF or both.

2. It is therefore worth making quite an effort to avoid a public row. Presumably a special Assembly session on Israeli cargoes, whatever majority decision might be, would tend to put UAR in a bad light with many Western countries. Israel might consider this desirable irrespective of prospects for changing Canal situation. Another possible row could conceivably arise over UNEF, unless UAR can be persuaded to modify their policy.

3. In circumstances therefore I would see no repeat no harm and some possible gain in a Canadian approach to UAR authorities, though results I think would depend on how we did it. If you do decide to instruct me to speak about Israeli cargoes, I would like also to express concern about presence of Palestinian Brigade and Feddayin in Gaza Strip. This would illustrate our locus standi, and the broad basis of our concern.

4. In case of Gaza Strip I would like to express view that appropriate UAR action would be to withdraw Palestinian Brigade and to withdraw or disarm Feddayin. But I would decidedly not repeat not recommend that any showdown be forced at this time by threatening categorically to withdraw forces from UNEF. Such threats could easily be counter productive.

Incidentally I would welcome information on UN Advisory Committee Meeting in New York.

5. In case of Suez cargoes, it would probably not repeat not be necessary before representations here to have a firm decision on substantive line which Canada would take in Security Council or Assembly. We would presumably wish to indicate that Canada tradi-tionally supports free passage, and naturally views with concern implications for international confidence of Egyptian use of Canal for purposes of extended economic blockade. (Previous Egyptian practice of denying Canal passage to Israeli ships was ostensibly based on conside-rations of Canal Zone security. This could hardly be applied with a straight face to chartered ships and to cargoes.)

6. Perhaps you might also wish me to express support [for] Secretary-General's ideas of a clear declaration on UAR's canal policy,⁵²⁰ and especially idea that canal transit questions be settled on legal plane. Further information on Secretary-General's line on canal issue and on Gaza Strip issue would be helpful.

7. I believe that an expression of Canadian views might be well received and even perhaps prove helpful if we spoke in context of overall and Iraqi situation, and explained our intervention as motivated by concern lest decisions on relatively minor matters lead to an unnecessary UN-UAR dispute that could cause setback on more basic issues of UAR's international relations. Actually, on June 1, emboldened by your telegram ME-125 of May 28,? I did speak somewhat along these lines on a strictly personal basis during course of a general tour d'horizon with Mourad Ghalib, telling him of my own concern at way things might shape up if UAR leaders were not repeat not careful. But speaking officially to one of Sabris or to Dr. Fawzi might be useful, or conceivably to President himself.

8. I expressed personal satisfaction to Ghalib at improvement of past few months in UAR-Western relations in general, and evidence of gradual growth of confidence of international community in UAR (I know UAR leaders are very anxious of this just now with respect to prospective World Bank loans), and at recent prospects for checking progress of communism in Baghdad. But I expressed personal concern lest all this be jeopardized if public difficulties should be created at this time between UAR and their friends in free world, eastern and western, who are concerned with UNEF or with international trade or both.

9. I found Ghalib receptive. He indicated that UAR leaders were profoundly unhappy about Israeli cargo situation and had not repeat not taken any final decision as yet. They are beginning to suspect (as incidentally do many foreign observers in Cairo) that Israeli Government may have deliberately sought to trap UAR into a revived cargo and chartered ship issue, in order to put a check to current improvement in President Nasser's relations with West, which Israeli Government is alleged to fear almost above all things. Ghalib referred to widespread advance publicity given to Inge Toft trip and cargoes, its build-up as a test case, and to challenging statements by Israeli Foreign Minister, to back up his suggestion of a deliberate trap.

10. Ghalib said that although no repeat no decision had yet been taken about disposition of Inge Toft cargo, UAR Government were in a tough dilemma, since if they allowed cargo to go through after publicity build-up UAR would appear helpless and ridiculous. I said they should have considered that earlier. He also indicated that UAR Government is concerned at prospects of growing economic relations between Israel and Far East.

11. Ghalib also said that if there were a UN debate on canal cargoes the UAR could defend itself against Israel by pointing to various UN resolutions on Palestine that Israel had flouted. I commented that in my opinion the real question was not repeat not whether UAR or Israel were in the right or in the wrong. Both could be wrong, from viewpoint of rest of world. Real question it seemed to me was whether proposed action would increase or decrease confidence between UAR and international community as a whole.

12. Ghalib referred to representation which USA Ambassador has made during week-end and said that they were being carefully studied. (Mr. Hare had given me a full account of these but you will presumably have had a report from Washington).

13. So far as we can ascertain here there still (June 3) appears to be no repeat no definite decision regarding Inge Toft cargo. But the Al Ahram article reported in my immediately following telegram? is not repeat not reassuring.

ARNOLD SMITH

⁵¹⁷On relations between the UAR and Iraq, see Part 1.
L'accord soviéto-égyptien sur la construction du barrage d'Assouan fut signé au Caire le 27 décembre 1958.

⁵¹⁸The Soviet-Egyptian agreement on the building of the Aswan High Dam was signed in Cairo on December 27, 1958.

⁵¹⁹On affirma qu'au cours du mois précédent, le gouvernement de la RAU avait facilité le mouvement de troupes palestiniennes dans la bande de Gaza, contrairement à une entente avec les Nations Unies selon laquelle seules les troupes de la FUNU seraient admises dans cette zone. Voir autres informations dans MAE 50366-40.
It was alleged that during the previous month, the UAR government had facilitated the movement of Palestinian troops into the Gaza Strip, in contravention of an understanding with the United Nations that only UNEF troops would be permitted in this area. For additional information, see DEA 50366-40.

⁵²⁰Voir/See Permis NY to Ottawa telegram 665, June 1,? DEA 50372-40.