As you are aware, it is our custom to consult the U.K. and the U.S. in connection with proposed significant arms shipments to Israel or the Arab States. We do not actually seek their approval, but we ask if they would be prepared to release the shipments in question if the requests were directed to them. To assist all concerned in assessing the importance of any proposed shipment a system has grown up whereby, in addition to consultation on individual cases of importance as they arise, we exchange with the U.K. and the U.S. on a bilateral basis every two months lists of arms items exported to each of the countries in question. In addition we receive from time to time the intelligence estimates of the U.S. and the U.K. of the arms levels of those various countries.

2. This informal system operates in parallel with a more formal and highly secret agency, the Near East Arms Co-ordinating Committee, on which the U.S., the U.K. and France are represented. We learned of this body some two years ago from the State Department, and were told at that time that the U.S. would welcome our association with N.E.A.C.C. but that perhaps the U.K. and certainly France would oppose our membership. At that time the committee met every two weeks in Washington to exchange information concerning arms levels in and arms shipments to the Near East countries, and to discuss the desirability of proposed releases of arms orders by the member governments. Apparently membership involves certain obligations of security concerning information put before the committee, and a commitment either to consult in the committee or to obtain its approval (our information does not make clear which) prior to the release of any significant shipment.

3. Recently, in connection with an enquiry relating to a particular request from Israel, we have been given a memorandum from the C.R.O. outlining current U.K. views on the control of arms shipments to Near East countries. The memorandum (of which the text is given in the attached Telegram No. 1655? from Canada House) suggests that we "might see some advantage in a closer direct association with the arrangements in Washington for the control of arms supply to the Middle East". The three foreign ministers at Geneva agreed to have the U.K. and French ambassadors review these arrangements with the State Department "to formulate procedures to maintain consultation about arms deliveries to Israel and the Arab States bordering on it. They are to consider what function ... the N.E.A.C.C. can usefully perform as part of these procedures, and to take into account the desirability of including in any such co-ordination shipments to the area by other friendly governments. The U.K. ambassador in Washington is being asked to keep the Canadian ambassador advised of the development of these plans".

4. When we first learned of the existence of N.E.A.C.C. two years ago we concluded that it was probably not to our advantage to seek membership. I am inclined to the view that this judgment is probably still valid, but I should outline for your consideration what I believe to be the factors bearing on our decision.

(a) Factors favouring our membership:

(1) It would probably make for more systematic consultation with the major powers most directly concerned, and thus perhaps give us a more complete picture on which to base our judgment in individual cases. It should be added that the present informal arrangement seems to work reasonably well, and the potential gain is probably not too great.

(2) In cases where one of the three great powers wishes to release a shipment which the others oppose, our membership would add one more restraining voice. While our influence would not in general be great, we would at least be recognized as having no direct political or strategic axe of our own to grind. Thus our participation should tend, at least to some extent, to reinforce the common declared objective of preventing a Middle East arms race against the somewhat disingenuous activities of great powers having special interests in the area.

(b) Factors discouraging our membership:

1. The practical problem of meeting the commitments involved, both in terms of representation and of the provision of independent intelligence estimates, would be a real one.

(2) There would be a considerable risk of implying special commitments with regard to the Middle East area. If in the future there should be real trouble in the area, the three present members of N.E.A.C.C. might press us to join them in some sort of intervention. Such pressure would be much more difficult to resist if we were members of any formal body specifically concerned with the area.

This consideration would of course depend greatly upon whether or not other powers (such as perhaps Belgium) should also become associated with the three powers.¹ We would not, I assume, wish to participate unless we were fully welcomed by all concerned, and in this connection we should keep in mind the report that two years ago the French were opposed to our joining.

3. Membership might undesirably restrict our freedom of action. This does not appear a very strong point, however, since the present N.E.A.C.C. system does not (to say the least) appear to bind its members too rigidly and we are in any case unlikely to wish to get far out of line with the U.K. and U.S. whether or not we are under any formal restriction. We are already bound to some extent, moreover, by the fact that many of our arms items concerned are of U.S. or U.K. origin or design.

5. Because of the close balance of arguments on the question I do not wish to recommend a decision either way at the moment. If you agree, I would propose to send this memorandum to the Embassy in Washington with a request to maintain contact with the U.K. ambassador on the progress achieved in the current talks. I believe we should ask in particular for information concerning any plan to associate other countries with the arrangements worked out among themselves by the three present members of N.E.A.C.C.²

6. These comments may be of use in discussion with Sir Gilbert Laithwaite, who sent the C.R.O. note to Canada House and who is expected to arrive in Ottawa on December 6 for the meeting of the U.K.-Canada Continuing Committee.

7. I am sending copies of this memorandum to European and Defence Liaison (2) Divisions, since they may wish to comment. As the time before Laithwaite's arrival is limited, I have not attempted to incorporate their views before sending this to you.

A.E. RITCHIE