U.S. policy in the Near East, South Asia, and Africa, 1954

U.S. POLICY

(

U.S. POLICY

in the

Near East
South Asia
and Africa

1954
by

HARRY N. HOWARD

Bureau of Near Eastern, South Asian
and African Affairs

The material in this pamphlet first appeared in three parts in the
Department of State BULLETIN of February 14, 21, and 28, 1955

DEPARTMENT OF STATE PUBLICATION 5801
Near and Middle Eastern Series 18

RELEASED MAY 1955

For sale by the Superintendent of Documents, U.S. Government
Printing Office, Washington 25, D.C. - Price 30 cents

U. S. Policy in the Near East,
Soutii Asia, and Africa — 1 954

It was not a matter of mere coincidence that the United States
was honored during 1954 by visits from President Celal Bayar and
Prime Minister Adnan Menderes of Turkey, Emperor Haile Selas-
sie of Ethiopia, Prime Minister Ben HaUm of Libya, President
WiUiam V. S. Tubman of Liberia, Prime Minister Mohammed AH
of Pakistan, the Shah of Iran, and the Prime Minister of Ceylon,
Sir John Kotelawala. For American interest in the countries of
the Near East, South Asia, and Africa continued at a very high level
following Secretary Dulles' historic visit to that area in 1953.

Both directly and within the framework of the United Nations,
the United States continued to deal with the great issues of this
troubled area. Many of the problems were very old and quite
complex. Some involved other Western Powers even more directly
than the United States. By the year's end some appeared in process
of solution and others had been placed in a more balanced per-
spective insofar as American foreign policy was concerned.^ Some
had reached the stage of active consideration — in their current
setting, at least— for the first time. Basically, the United States
continued its fundamental interest in the security, the stability, and
the welfare of the peoples and states of the Near East, South Asia,
and Africa and sought to achieve its objectives within this broad
interest.

Specifically, the United States was confronted with a number of
important and concrete issues, which illustrate the kinds of prob-
lems brought to the American doorstep, including (i) the Anglo-
Iranian oil controversy, which was pushed toward solution by Au-
gust 1954; (2) the Anglo-Egyptian dispute with respect to the Suez
Canal Zone, agreement on which was reached in October 1954;
(3) the problem of Cyprus, which the Greek Government pre-
sented to the United Nations General Assembly in the fall of 1954;

See footnotes on pp. 63-70.

1

(4) the perennial problem of Palestine; and (5) the North African
questions of Morocco and Tunisia.

In his report on the work of the United Nations for 1953-1954,''
Secretary-General Dag Hammarskjold made general reference to
problems arising especially from areas like the Near East, South
Asia, and Africa and more particularly to issues involving questions
of self-determination of peoples and the economic development of
underdeveloped countries — issues as likely to determine the "shape
of things to come" as the so-called East-West conflict. In the view
of the Secretary-General, experience had demonstrated, particu-
larly since the end of World War II, "the complexities of the
problems and at times the threats to peace found in the areas, still
very numerous, inhabited by non-self-governing peoples." The
many issues in this sphere which regularly confronted the United
Nations called for "a balance between vision and restraint, recog-
nizing the fundamental right to self-determination as well as the
fact that the exercise of self-determination" might be "self-defeat-
ing if not wisely and carefully prepared." The manner in which
such issues were dealt with would have "a serious bearing also upon
the future course of world events."

Another great set of issues lay in the field of the economic de-
velopment of underdeveloped areas. Indeed, the Secretary-Gen-
eral indicated that, in this general field, there were two trends
which, if permitted to go unchecked, might prove more dangerous
in the long run than the conflicts which so monopolized the atten-
tion of the United Nations. The first of these was the rapid in-
crease in population, especially in those areas where standards of
living were lowest. The other was the manner in which standards
of living in those same areas were "still lagging far behind those
of the more economically advanced regions." It was, moreover,
clear that no attack on these trends could be successful "without a
combination of measures of an order of magnitude far beyond"
what had "so far been undertaken."

These were not, however, the only issues, for there were those
of internal stability and the problem of the general economic im-
balance from which world trade was still suffering. In the view
of the Secretary-General, the United Nations would, as the only
tool of its kind available to member governments, "make an essen-
tial contribution in developing a policy which in due time" would

2

"raise the economically underdeveloped areas to a level" where
they would "take their proper place in world trade and find a
basis for a progressive social policy giving their populations a fair
share in the growing wealth of the world."

The Anglo-Iranian Oil Controversy

An important issue in the Middle East in which the United
States was very much interested, and in the settlement of which
it played a major role, was the Anglo-Iranian oil controversy. The
problem involved not merely the difficult and complicated ques-
tion of oil but also the normalization of Anglo-Iranian relations,
which had been interrupted in 1951, as well as the ultimate restora-
tion of Iran's rightful place in the free world and the continued
prospect of social and economic progress within that country.
Two American officials played stellar parts in the events which led
to final settlement. One of these was Herbert Hoover, Jr., who
had been a consultant in the Department of State since September
1953- The other was the United States Ambassador to Iran, Loy
W. Henderson, who served as the principal point of contact be-
tween the British, the Iranians, and the oil companies during the
difficult negotiations.'

The announcement of final agreement was made in a joint state-
ment by the Government and the Oil Consortium on August 5,
1954.* An essential part of the Consortium agreement was the
settlement of the question of compensation to the Anglo-Iranian
Oil Company. Two companies were to be formed to operate the
oilfields and the Abadan refinery, respectively, and they were to
receive the necessary rights and powers from the Iranian Govern-
ment and the National Iranian Oil Company and to exercise them
on their behalf to the extent specified in the agreement.

The Consortium companies were to pay the National Iranian
Oil Company for all the oil required for export and sell the crude
oil and products exported, while the latter might take the crude
oil in kind, in lieu of payments, up to i2'/4 percent of total exports.
Products for consumption within Iran were to be available to
the National Iranian Oil Company at substantially their cost. The
agreement covered a period of 25 years, with provisions for three

3

5-year extensions. Through payments to the National Iranian
Oil Company and the application of Iranian tax laws, it was esti-
mated that the total direct income to Iran from the increased scale
of operations for the first 3 full years, following an initial period
of 3 months, would be 150,000,000 ($420 million). The esti-
mated figures began at ^^31,000,000 ($86 million) for the first full
year of operation, increasing to ;r 67,000,000 ($185,600,000).

The National Iranian Oil Company was to continue to operate
the Naft-I-Shah oilfield and the Kermanshah refinery to produce
part of Iran's own domestic needs, and to continue to handle the
distribution of oil products in Iran. It was also to be responsible
for all facilities and services not directly a part of producing, re-
fining, and transportation of the operating companies.

Production of crude oil from Iran, following the initial 3 months,
was to be increased progressively, bringing total exports of crude
and products to a minimum of 80 million cubic meters (78 million
tons; 500 million barrels for the first 3-year period), with 5 million
cubic meters for internal consumption. But following the third
year, it was to be the policy of the Consortium to continue taking
quantities of crude which would reasonably reflect the supply and
demand trend for crude oil in the Middle East, "assuming favor-
able operating and economic conditions in Iran."

Large-scale operations at the Abadan refinery were to be re-
sumed as qiiickly as possible. Following the initial 3-month
period, it was expected that a total of 35 million cubic meters (30
million tons; 220 million barrels) of crude would be processed
for export during the first 3 years of operation, with 15 million
cubic meters (13 million tons; 94 million barrels) processed dur-
ing the last 3 years, a rate which would "once again establish
Abadan's output as the largest in die Eastern Hemisphere, despite
sharp increases in refinery capacity in that area during the last
three years."

The two operating companies in Iran were to be organized by
the Consortium and to carry on operations within a specified area,
one to deal primarily with exploration and production and the
other with refining. Both were to be registered in Iran with their
own management and operating headquarters and incorporated
under the laws of the Netherlands. They were to have seven di-
rectors in each company, two to be named by Iran and five by the
Consortium.^

4

An American teacher, sent to Iran under Fulbright program, teaches fertilizing
methods to students at Near East foundation's rural teacher-training school
near Tehran.

President Eisenhower greeted the signature of the agreement,
and the Shah expressed the hope that Iran might now "look for-
ward to an era of economic and social development" which would
improve the lot of his people, "as well as further consolidate the
security of the Middle East." That was also the sentiment of the
Iranian Foreign Minister, AbdoUah Entezam, who hoped that the
Iranian Government would "be able with revenues derived there-
from to carry out its economic and social programs for raising the
standards of living of the Iranian people." He also realized that
"the execution of these programs" would "play an important part
in the maintenance of peace and international security" and was
certain that American officials were doing all they could "to assist
in the economic and social development of Iran." "

Agreement in principle with respect to the oil controversy, it
was thought, would eventually bring Iran into closer association
with the West and its anti-Communist neighbors. The agreement
was presented to the Iranian Parliament on September 21. One

6

month later the MajUs acted favorably, and on October 28 the Sen-
ate approved ratification, which was completed when the Shah
gave the royal assent on October 30/ Iranian oil began moving
to the world market on October 31, when the tanker British Advo-
cate, of the oil fleet of the Anglo-Iranian Oil Company, pulled away
from the refinery quayside with 11,500 tons of oil bound for Trin-
comalee, Ceylon, the first Iranian oil to move freely into world mar-
kets in 40 months. With the resumption of the Iranian oil indus-
try, the Department of State announced that there was reason to
believe that Iran would be "in a better position than in the recent
past to make full use of its great natural resources," that its people
would "enjoy a new era of economic and social progress," and that
they would "play an ever-increasing role in the maintenance of
peace and security in the Middle East." *

The Anglo-Egyptian Controversy
Concerning the Suez Canal

While it was primarily a matter for settlement between the
United Kingdom and the Egyptian Government, the United States
was very much interested in a settlement of the Anglo-Egyptian
controversy with regard to the Suez Canal Zone. As in years past,
the United States was concerned with the freedom and security of
this great international arterial water route and with the defense of
the Eastern Mediterranean and the security of the Middle East.

The United States had indicated its interest in the problem,
among other ways, in the promotion of the Middle East Command
and the Middle East Defense Organization in 1951-1952. As a
friend both of Egypt and of the United Kingdom, it had sought
to encourage an amicable and equitable settlement of the con-
troversy, and Jefferson Caffery, U.S. Ambassador to Egypt, had
played an important role in finding an ultimate solution. The
United States was, therefore, gratified when the United Kingdom
and Egypt, on July 27, 1954, signed Heads of Agreement with re-
spect to a settlement, and it was agreed that, "with a view to estab-
lishing Anglo-Egyptian relations on a new basis of mutual under-
standing and firm friendship, and taking into account their obliga-
tions under the United Nations Charter, an agreement regarding
the Suez Canal should now be drafted." °

3.H6711 0—55 2

7

Both President Eisenhower and Secretary Dulles greeted the
Anglo-Egyptian agreement in principle concerning the Suez Canal,
the latter characterizing it on July 28 as —

a majoi step in the evolution of the relations between the states of the Near
East and the nations of the West. This agreement eliminates a problem
which has affected not only the relations between the United Kingdom and
Egypt but also those of the Western nations as a whole with the Arab States.

Secretary Dulles hoped that it would mark "the beginning of a new
era of closer collaboration between the states of the Near East and
those of the West." He continued,

Thanks to this agreement a new and more permanent basis has been laid
for the tranquillity and security of the Near East. The United States wel-
comes in particular Egypt's decision to make the Suez Base available to the
United Kingdom in case of aggression against the area. The United States
is also pleased to note the recognition by the two parties of the importance of
the Suez Canal and the determination to uphold the Convention of 1888,
which guarantees freedom of navigation through this vital artery.

The United States was also favorably impressed by the plans of
Egypt to concentrate on internal social and economic development.
With the solution of the problem of the Suez Base, the United
States welcomed the stated intention of the Egyptian Government
"to devote its full energies to these problems so important to the
future well-being of the Egyptian people."

Secretary Dulles extended his "heartiest congratulations" on
August 3 to British Foreign Secretary Eden and to Prime Minister
Gamal Abdel Nasser and Foreign Minister Mahmoud Fawzi. All
appeared to share his view that the agreement would make a genu-
ine contribution both to the establishment of friendship and to the
stability of the Middle East. Secretary Dulles was certain that the
settlement would —

establish the foundation for even closer collaboration between our countries
on the problems affecting the Near Eastern area, and in the long run the
Agreement will produce greater stability and defensive strength in the area.

In turn, Prime Minister Nasser was confident that it would "start
a new era of closer cooperation with the United States as well as
with all other friendly countries," and he was grateful "for the help
and assistance of the leaders and the Government of the United
States" in bringing it about.""

9

The final agreement, signed on October 19 at Cairo, carried out
in detail the principles embodied in the Heads of Agreement."
Among other things, it provided for the complete withdrawal of
British forces from Egyptian territory within a period of 20 months
after signature, ended the Anglo-Egyptian alliance of August 26,
1936, and called for maintenance of parts of the base "in efficient
working order and capable of immediate use" in accordance with
article 4 of the agreement.

Article 4 contained the essential provision with respect to de-
fense. It stipulated :

In the event of an armed attack by an outside Power on any country which
at the date of signature of the present Agreement is a party to the Treaty of
Joint Defence between Arab League States, signed in Cairo on the 13th of
April 1950, or on Turkey, Egypt shall afford to the United Kingdom such
facilities as may be necessary in order to place the Base on a war footing and
to operate it effectively. These facilities shall include the use of Egyptian
ports within the limits of what is strictly indispensable for the above-men-
tioned purposes.

British forces, however, were to be withdrawn immediately upon
the cessation of hostilities (article 5). In the event of a threat of an

British troops leave Egypt for new stations, following last year's Anglo-
Egyptian agreement on Suez Canal.

I

armed attack by an outside power, according to article 6, either
upon a party to the Arab Treaty of Joint Defense or upon Turkey,
there was to be "immediate consultation" between Egypt and the
United Kingdom.

While article 7 provided for the right of overflying, landing, and
servicing facilities for notified flights of aircraft under Royal Air
Force control, article 8 embodied the essential principles concern-
ing the Suez Canal:

The two Contracting Governments recognise that the Suez Maritime
Canal, which is an integral part of Egypt, is a waterway economically, com-
mercially and strategically of international importance, and express the de-
termination to uphold the Convention guaranteeing the freedom of naviga-
tion of the Canal signed at Constantinople on the 29th of October 1888.

The agreement, according to article 10, was not to affect in any
way "the rights and obligations of the parties under the Charter of
the United Nations" and was not to be so interpreted. It was to
remain in force for 7 years from the date of signature, and 12
months prior to expiry the two Governments were to consult to
decide on such arrangements as might be necessary upon termina-
tion of the agreement (article 12).

The organization of the base, in accordance with annex I of the
agreement, gave the United Kingdom the right to maintain cer-
tain agreed installations and to operate them for current require-
ments. But following withdrawal of British forces, which was to
take place within a period of 20 months from the date of signature,
the Egyptian Government was to assume responsibility "for the
security of the base and of all equipment contained therein, or in
transit on Egyptian territory to and from the base." There was also
provision for contracts with one or more British or Egyptian com-
mercial firms for the upkeep and operation of installations, which
would have the right to engage British and Egyptian civilian tech-
nicians and personnel, the number of British technicians not to
exceed an agreed figure. The Egyptian Government was to main-
tain in good order such installations, public utilities, communica-
tions, bridges, pipelines, and wharves as would be handed over in
accordance with the Anglo-Egyptian agreement. The United
Kingdom was to have facilities for inspection.

Achievement of the final agreement concerning the Suez Canal
Zone also produced genuine satisfaction in the United States, and
Secretary Dulles, on October 19, pronounced it "an event of far-

11

reaching importance and an occasion for renewed congratulations
to both countries." He believed that "the removal of this de-
terrent to closer cooperation" would "open a new approach to
peaceful relations between the Near Eastern states and other na-
tions of the free world" and hoped that this cooperation might
now "develop fully to the mutual advantage of all concerned" and
"strengthen the stability and security of the area." With Egypt
now assuming "new and fuller responsibilities" as the Suez Base
passed from British to Egyptian hands, Secretary Dulles once more
expressed his satisfaction that Egypt had reiterated "its adherence
to the principle of freedom of transit through the Canal in con-
formity with the 1888 convention."

The Question of Cyprus

One of the interesting problems with which the United States
was confronted in the General Assembly of the United Nations
during the fall of 1954 was that of Cyprus.

The history of the Island of Cyprus goes back to ancient days.
Cyprus had been ruled by Assyrians, Phoenicians, Persians,
Ptolemies, Greeks, Romans, Byzantines, Lusignan princes, and Ve-
netian merchants before it came under Ottoman sovereignty in
1571. The Island was brought under British administration in an
Anglo-Ottoman agreement of June 4, 1878, a few days before the
opening of the Congress of Berlin, after the Russo-Turkish War
of 1877-1878. According to that agreement, in order to meet the
threat of Russian advances into Eastern Anatolia, the British Gov-
ernment promised to defend the Ottoman Empire against any fur-
ther attack on Ottoman Asiatic territories and, in return. Great
Britain was to occupy Cyprus.

The technical status of the Island was changed on November 5,
1914, when Cyprus was formally annexed, following the entry of
the Ottoman Empire into the First World War against the Allied
Powers. As one of the inducements to bring Greece into the war,
Great Britain offered Cyprus to Greece in 1915. In the Treaty of
Lausanne, July 24, 1923, Turkey recognized the annexation of
Cyprus and renounced all rights and title with regard thereto.
It became a Crown Colony in 1925. The population of the Island

12

is about 500,000, about 80 percent of whom are Greek-speaking and
Orthodox Christian in faith, and about 20 percent Turkish and
Moslem/''

Prior to the ninth session of the General Assembly, no official
attempt had been made to place the question of Cyprus on the
agenda. There were, however, brief references to the problem at
the seventh session in 1952, and at the eighth session, on Septem-
ber 21, 1953, Ambassador Alexis Kyrou declared the intention of
Greece to bring the issue before the United Nations if direct Anglo-
Greek discussions proved to be fruitless."

Since the Greek Government believed this to be the case, it filed
a request on August 20, 1954, with the Secretary-General of the
United Nations asking that the problem be placed on the agenda."
The problem was brought before the General Assembly under
articles i (2), 10, and 14 of the charter, although the Greek Gov-
ernment reserved the right to refer to article 35 (i), in case it con-
sidered such a course justified by subsequent developments. After
reviewing briefly the history of the problem, from the Greek point
of view, the Greek memorandum indicated that Greece had ex-
hausted all diplomatic steps and that the Government felt im,-
pelled to address the United Nations "to redress this situation by
achieving the solution called for by justice, dignity and the sacred
principles set forth in the Charter." It appealed to the General
Assembly, convinced that it would "accomplish a constructive
work of peace and freedom."

On July 28, the United Kingdom had indicated that it could not
"contemplate a change of sovereignty in Cyprus" but would pro-
ceed with constitutional changes which were, as yet, not fully
worked out. In a statement of August 19, the United Kingdom
publicly set forth its position concerning the problem of Cyprus."
After indicating that, with the exception of a brief period in the
4th century, B. C, Cyprus had never belonged to Greece, and that
the Russian danger which had brought Great Britain to Cyprus in
1878 still threatened, the British statement advanced a number of
strategic considerations for continued British sovereignty over the
Island, namely that (i) effective British control was essential to
the fulfillment of British strategic obligations in the Middle East
and to the North Atlantic Treaty Organization; (2) a Cyprus base
leased from Greece could not afford the necessary security of
tenure; (3) Great Britain could no more consider relinquishing

13

sovereignty over Cyprus than over Gibraltar, and its experience in
Egypt had shown that bases w^ithout sovereignty could not always
be relied upon.

The British statement also contended that the internal political
development of Cyprus had been retarded by the rejection in 1948
of a constitution, and that the Communist Party in Cyprus was
now "a real menace to democratic development" in the Island.
The new constitutional project, in the British view, would protect
Cyprus from "encroaching communism" by providing for an
official and nominated majority in the legislature. Finally, the
United Kingdom contended that, since Cyprus was a dependent
territory, its affairs were entirely within the domestic jurisdiction of
the United Kingdom and that intervention by the United Nations
would be contrary to article 2 (7) of the charter and therefore il-
legal. The United Kingdom also maintained that debate in the
General Assembly could do nothing but exacerbate feelings at a
delicate stage, thus delaying indefinitely the political progress of
Cyprus, which it was the responsibility of the United Kingdom to
promote. Debate on the issue would also serve the purpose of the
Soviet Union to foster differences among the Western allies.^*

DEBATE ON INSCRIPTION

The question of formal inscription of the problem of self-de-
termination in Cyprus on the agenda of the ninth session of the
General Assembly came before the General Committee on Septem-
ber 23, 1954, with Mr. Kyrou, the Director General of the Greek
Foreign Ministry, presenting the case for inscription."* Reducing
the issue to its essentials, Mr. Kyrou declared that it pertained to
"the future political status of a mature and civilized population
upon whom a foreign rule" had been imposed, and that Greece
had been compelled to resort to the General Assembly because the
United Kingdom had refused to discuss the problem and had indi-
cated that Cyprus belonged to "certain territories in the Common-
wealth which, owing to their peculiar circumstances," could "never
expect to be fully independent." The Greek Government felt that
the "liberation" of Cyprus constituted "a major moral issue" and
had based its appeal on articles 10 and 14 of the charter. Mr.
Kyrou held that few cases fitted as well within the framework of

14

the charter, since the General Assembly was authorized to "rec-
ommend measures for the peaceful adjustment of any situation,
regardless of origin," which it deemed "likely to impair the gen-
eral welfare or friendly relations among nations, including situa-
tions resulting from a violation of the provisions" of the charter
"setting forth the purposes and principles of the United Nations."

In turn, Selwyn Lloyd, who responded for the United Kingdom,
opposed inscription and considered the problem a "test of wisdom"
for the United Nations. Mr. Lloyd repeated the basic British posi-
tion, pointed out that Greece had been a signatory of the Treaty of
Lausanne, which had recognized British sovereignty over Cyprus,
and contended that the Greek action would establish a precedent
that a state could raise a question within the United Nations which
had already been settled by a treaty, in conflict with the preamble
of the charter concerning "respect for obligations arising from
treaties and other sources of international law."

Mr. Lloyd also pointed out that, through enosis, Greece desired
not merely to terminate British sovereignty but to assume sover-
eignty itself, and was thus asking for interference in the domestic
jurisdiction of a foreign power in order to effect an advantageous
territorial change. This "most disturbing precedent," in the Brit-
ish view, would mean that few frontiers could be considered per-
manent. If established, "the floodgates would be opened to claims
and counterclaims, friction and bad feeling and subversive activities
among the ethnic groups would be encouraged everywhere." Mr.
Lloyd especially deprecated the reference to article 35 (i) of the
charter, which related to disputes "likely to endanger the main-
tenance of international peace and security," since he could not
understand how the situation in Cyprus could endanger the peace
except through armed action on the part of Greece. He also con-
sidered that article 2 (7), concerning domestic jurisdiction, was
"applicable in its entirety to a discussion of the matter in the Gen-
eral Assembly" and contended that "discussion" amounted to
"intervention."

But the Greek Government, said Mr. Lloyd, was even asking for
action by the United Nations and a change of sovereignty, which
would be "such a flagrant violation of article 2 (7) of the charter
that the inscription of the item would have serious consequences"
for Britain's relations with the United Nations, which he did not
8;h67ii o — 55 H

15

specify at the moment. He did suggest, however, that, in voting
on inscription, governments should be guided by "political reali-
ties" and by the interests of the United Nations. He noted that the
propaganda of the Orthodox Church and the Communists of
Cyprus represented an "emotional appeal" which was bitterly op-
posed by the strong Turkish minority on the Island, and he re-
called the 50-year record of the British administration with pride.

In conclusion Mr. Lloyd pointed out the strategic importance
of Cyprus in the fulfillment of British responsibilities under the
North Atlantic Treaty Organization and under various Middle
East treaties. In the British view, a public debate in the United
Nations could only affect friendly relations in the Eastern Mediter-
ranean, and satisfaction would be drawn only by those elements
which sought "to profit by international tension." Moreover, other
governments might "try to fish in troubled waters." Mr. Lloyd
assured Mr. Kyrou that there was "nothing anti-Greek" in the
British position, but the United Kingdom stood by its views "in
the interests of our two countries and of the United Nations,"
and would do all it could "to see that this disagreement" raised "no
bitterness" and left "no scars."

Both the French and Turkish representatives fully shared the
British view in general and as to the application of article 2 (7)
of the charter, while Ambassador Francisco Urrutia of Colombia
expressed "certain doubts" concerning the problem and wondered
whether the "sacred right" of self-determination applied when the
aim was not independence but a change of sovereignty. Mr.
Urrutia was also concerned with the element of stability and re-
called that in the Western Hemisphere "foreign support" had led
to a movement which had been very difficult to suppress. If the
principle of self-determination were accepted in the case of Cyprus,
it might lead to a whole series of cases which had been regarded as
settled, and it might be dangerous to world peace if ethnic groups
could look to the United Nations for a "sort of permanent pleb-
iscite" on questions of sovereignty. Mr. Urrutia considered it un-
fortunate that a 'hasty" decision had to be taken on an issue which
had so many implications, and would abstain on inscription.

Mr. Kyrou was "deeply moved" by the remarks of Mr. Lloyd
and fully shared the latter's friendly sentiments, but he believed
that an airing of the Cyprus problem would not injure Anglo-
Greek or Greek-Turkish relations. Mr. Kyrou noted that, under

16

article 73 (e) of the charter, the United Kingdom had acknowl-
edged that Cyprus belonged to a "special category" of territories,
the goal of which was self-determination, while article 103 estab-
lished the priority of charter obligations over those flowing from
treaties such as the Treaty of Lausanne (article 20). Mr. Kyrou
also contested the British interpretation of article 2 (7), holding
that it should be interpreted in the light of the entire charter, and
particularly in the light of article 10 and the purposes and prin-
ciples enshrined in articles i and 2, lest the principal provisions of
the charter be rendered "nugatory."

While Mr. Lloyd closed with the comment that Mr. Kyrou had
really been outlining "the Greek claim to Cyprus," not merely
urging inscription of the problem on the agenda, the General
Committee now proceeded to approve inscription, by a vote of
9 to 3, with 3 abstentions.'"

The plenary session of the General Assembly considered the
matter of inscription on September 24, a move by Dr. Fadhil Mo-
hammed al-Jamali of Iraq temporarily to postpone the issue being
rejected by a vote of 24 to 24, with 12 abstentions, with the United
States favoring postponement.^^ In the ensuing discussion, Mr.
Lloyd repeated the British case, announcing that the United King-
dom would take no part in the discussion in the event of inscription
of the problem of Cyprus on the agenda. Moreover, he indicated
that the United Kingdom had based its case against inscription on
grounds which were "far wider" than that it would violate the
charter, and he asked the General Assembly to "look where you
are going" lest all frontiers become useless under the principle of
self-determination espoused by Greece. Mr. Lloyd declared that
all treaties resulted in frontiers which divided ethnic groups and
that practically none could stand if attacked on the basis of self-
determination. He especially called upon the Latin American rep-
resentatives to ponder the issue well. Finally, Mr. Lloyd felt it
to be "political folly" to place an issue of this sort on the agenda
and reiterated that there was no oppression in Cyprus. He closed
with a repetition of the British position on the strategic importance
of Cyprus in connection with the United Kingdom's responsi-
bilities under the North Atlantic Treaty Organization and referred
to recent constitutional proposals with regard to Cyprus.

There were other expressions of concern with regard to placing
the question of Cyprus on the agenda. Halvard Lange of Norway

17

was opposed to inscription (i) because the United Nations was
"obliged" to refrain from becoming an impediment to a solution
of a problem and (2) because, as presented, the question went be-
yond the charter concerning self-determination. Mr. Lange be-
lieved that the consequences of embarking on the course proposed
by the Greek Government were "unpredictable and ominous" and
that inscription could only harm the relations between the United
Kingdom and Greece. Ambassador Selim Sarper of Turkey, who
noted the Turkish alliances with Greece and the United Kingdom,
declared that it would have been wiser not to have created a
"Cyprus question," considered British administration of the Is-
land to be a domestic problem under article 2 (7) of the charter,
and felt that inscription would be "too heavy a burden" for the
United Nations to bear. It was also interesting to observe that
V. K. Krishna Menon of India said he could not support inscription
since the Greek proposal, essentially, called for transferring sover-
eignty from one country to another, not for self-determination or
independence.

Foreign Minister Stephanos Stephanopoulos of Greece closed
the discussion with an exception to Mr. Lloyd's remarks concern-
ing the historical association of Cyprus with Greece, noted Greek-
Turkish friendship as "a political reality," and rejected the British

Greetings are exchanged by Greek and Turkish troops in first joint maneuvers
held by those two countries under NATO.

interpretation of article 2 (7) as applied to the question. As to the
strategic reasons for retention of Cyprus under British sovereignty,
Mr. Stephanopoulos wondered what good strategic bases could be
if they were located among an essentially hostile population.

In the end, inscription was approved by a vote of 30-19-11, with
the United States abstaining but, again, taking no part in the dis-
cussion of the problem. Serious doubts about bringing up the
problem were expressed by J. M. A. H. Luns of the Netherlands,
Paul Martin of Canada, and Ambassador Urrutia of Colombia,
who explained that Colombia had switched to a negative vote be-
cause it believed the Lausanne Treaty should be respected. On
the other hand, the Egyptian delegation approved inscription be-
cause of the element of self-determination.^^

The Greek Government was pleased with the decision on in-
scription, but there was no further specific reference to the problem
until it came before the Political and Security Committee (Com-
mittee I) at the close of the ninth session. During the general
debate on September 30, however. Foreign Minister Stephanopou-
los stressed two matters which he considered of special significance :
(i) support for the principles of the United Nations Charter despite
current political interests; and (2) respect for resolutions of the
General Assembly.^^ Mr. Stephanopoulos noted that certain dele-
gations had declared the intention of their governments to ignore
any action or resolution of the General Assembly which did not
conform with their views or interests. He thought it "particu-
larly regrettable" that "they came here to show us the 'wastebasket'
into which certain governments intend to throw the resolutions
and recommendations of the Assembly." From the viewpoint of
major interests of the United Nations, this was "inadmissible."
In the Greek view, all member states should recognize the moral
authority of the United Nations which they had undertaken to
respect. If they recognized as valid only such decisions as they
wished, the United Nations would be threatened by mortal danger,
and Mr. Stephanopoulos thought the problem called for study and
constructive solutions.

DISCUSSION IN COMMITTEE I

The Cyprus question came up for formal discussion in Com-
mittee I on December 14 and 15.^^ On a point of order at the out-

19

set, Ambassador Leslie Knox Munro of New Zealand introduced a
resolution whereby the General Assembly would agree not to con-
sider the problem further. While Ambassador Munro, and those
who supported his position, were not seeking to stifle discussion, he
was fearful lest extended and possibly acrimonious debate lead to
mischief and create difficulties between the states directly con-
cerned. He held the view that, not the question of self-determina-
tion, but a Greek territorial claim was essentially involved. In
turn, the representative of Greece, Ambassador Kyrou, presented
a draft resolution whereby the General Assembly would express
the "wish" that the principle of self-determination be applied to
Cyprus, and he vigorously denied that the question was a mere
Greek territorial claim. In supporting priority for the draft resolu-
tion of New Zealand, Ambassador Henry Cabot Lodge, Jr., of the
United States declared that the raising of the Cyprus issue in the
United Nations at the time had been a matter of very deep concern
to the United States. Mr. Lodge said.

It affects the interests and sentiments of nations and peoples with whom
wc feel the closest bonds of sympathy. Moreover, the welfare of much of
the free world depends upon the maintenance of their historic friendship
and mutual trust among each other.

The. United States is convinced that the paramount task before this body
is to dispose of this item so as not to impair that friendship and trust, be-
cause that continuing relationship and solidarity are vitally important to the
peace and stability of the area of which Cyprus is a part.

After very searching and deliberate thought and lengthy consultations
with those directly concerned, we in the United States Government have
reached the conclusion that the course of wisdom is that proposed by the
representative of New Zealand.

Recognizing the deep emotions which have already been stirred by this
issue, we believe that a prolonged consideration in this forum would only
increase tensions and embitter national feelings at a time when the larger
interests of all concerned are best served by strengthening existing solidarity
among the freedom-loving nations.

Antony Nutting, the representative of the United Kingdom, who
was not prepared to discuss the substantive issue, indicated that the
United Kingdom, which considered the problem of Cyprus as fall-
ing under its domestic jurisdiction under article 2 (7) of the char-
ter, was proceeding toward self-government in Cyprus. He could

20

see no useful purpose in this discussion and warned that the com-
mittee was faced with a "very grave decision," since the area con-
cerned was politically delicate and the scene was historically one of
great tragedy. "Impetuous action" might release forces which
could sweep away the efforts of a generation.

The substance of the issue was, in fact, discussed on the basis of
Ambassador Munro's proposal, with Ambassador Kyrou outlin-
ing the Greek position on the afternoon of December 14.^' Am-
bassador Kyrou traced something of the history of the problem,
outlined the movement toward self-determination in Cyprus, de-
nied that Greece sought a territorial change as such, maintained
that Greece would abide by any freely expressed decision of the peo-
ple of Cyprus, and indicated that a solution was being sought
through the orderly processes of the United Nations, based essen-
tially upon articles i (2) and 10 of the United Nations Charter.
Ambassador Sarper of Turkey, who said he considered that the
Cyprus question was artificially stimulated and that it should never
have come to the United Nations because of article 2 (7) of the
charter, pointed to the long historical association of the Ottoman
Empire with Cyprus from 1571 to 1878 and to the large Turkish
element of 100,000 people on the Island, and expressed his con-
cern lest debate on the issue affect Anglo-Greek-Turkish relations
within the North Atlantic Treaty Organization and weaken the
structure of the new Greek-Turkish-Yugoslav treaty of mutual
assistance. He declared that Turkey considered the status of
Cyprus as fixed under the terms of the Treaty of Lausanne and
stated that if the issue were raised again, in whatever form, justice
and equity could be served if Turkish consent and cooperation were
"unequivocally obtained," for otherwise no decision could be
enduring.^*

In the end, the proposal of New Zealand, to which priority had
been given, was approved as amended by Colombia and El Salva-
dor. The General Assembly decided that, "for the time being,"
it was "not appropriate to adopt a resolution on the question of
Cyprus" and that it should not consider the matter further.^" The
vote in Committee I was 49 in favor, with none against and 11 ab-
stentions. In the plenary session of December 17, the vote was 50
in favor, none against, and 8 abstentions.^"

21

The Problems of Palestine

The United States was faced with a number of problems arising
from the issue of Palestine during the course of 1954, involving
the perennial question of frontier incidents, the strengthening of
the United Nations Truce Supervision Organization, the Israel-
Egyptian controversy over transit of the Suez Canal, the refugee
problem, and the development of a regional approach to the water
problem. Although the Security Council of the United Nations
was busy with various aspects of the Palestine problem during
1954, little was accomplished. Indeed, the Secretary-General of
the United Nations reported to the ninth session of the General
Assembly in the fall of 1954 that the situation in the Middle East
had deteriorated and that the efforts made in the Security Council
to improve conditions were "without result." ^" The Secretary-
General offered his services to the parties to facilitate negotiations
aiming at the solution of "certain practical problems of limited
scope." He felt, however, that —

it should be recognized that the time is not yet here for a peace settlement
between the Arab States and Israel. But this should not render impossible
the elimination of many points of friction which do not raise any questions
of principle. In the meanwhile, it is the duty of the countries concerned to
put an end to actions of reprisal which, in a sinister series of attacks and
counterattacks, have cost many innocent lives and have embittered the rela-
tions between the peoples of the region. The situation has been further com-
plicated by steps which have reduced the opportunities for the United Na-
tions organs in the field to render their impartial services to the parties con-
cerned. The existing situation is a matter of deep concern. In the effort
to build up the authority of the United Nations as an agent for peace and
justice, the co-operation of the Governments of the Members in the area is
essential.

Assistant Secretary Henry A. Byroade described the outlook of
the United States on the problem of Palestine in an address before
the Dayton (Ohio) World Affairs Council on April 9.™ Mr.
Byroade reviewed the story of the Middle East, noted its signifi-
cance for the United States, and described the attempts of the
United States to bring about some kind of settlement of the Israel-
Arab conflict, including the encouragement of regional defense
measures against external aggression. He outlined the conflicting

22

Israel and Arab views of the situation, and then, speaking directly
to the parties concerned, said :

To the Israelis I say that you should come to truly look upon yourselves
as a Middle Eastern state and see your own future in that context rather
than as a headquarters, or nucleus so to speak, of worldwide groupings of
peoples of a particular religious faith who must have special rights within
and obligations to the Israeli state. You should drop the attitude of the
conqueror and the conviction that force and a policy of retaliatory killings
is the only policy that your neighbors will understand. You should make
your deeds correspond to your frequent utterances of the desire for peace.

To the Arabs I say you should accept this state of Israel as an accomplished
fact. I say further that you are deliberately attempting to maintain a state
of affairs delicately suspended between peace and war, while at present
desiring neither. This is a most dangerous policy and one which world
opinion will increasingly condemn if you continue to resist any move to ob-
tain at least a less dangerous modus vivend't with your neighbor.

This address was subject to much criticism from both Israel and
Arab sources.

Mr. Byroade spoke again on May i before the American Council
for Judaism at Philadelphia, referring particularly to recent de-
velopments in Soviet policy in the Middle East and pointing to a
number of fundamentals in the situation." In the first place, he
saw no likelihood of an early and formal peace settlement between
the Arab States and Israel, although he had not lost hope of some
kind of modus vivendi. He thought the Arab States should accept
the existence of Israel but were entitled to know "the magnitude
of this new State." Second, the Arab fear of expansionist Zionism
should be understood and met not only by the assurances of the
great powers but by Israel itself. A third element in the picture
was the Arab mistrust of the great powers, especially the United
States, with respect to the Arab-Israel controversy, since the Arabs
questioned the ability of the United States, the United Kingdom,
and France to fulfill their obligations concerning aggression under
the Tripartite Declaration of May 25, 1950," if Israel decided upon
"expansive aggression." A fourth lay in the fact that a large por-
tion of the people involved in the Arab-Israel conflict were homeless
and that the problem of these desperate refugees was still unsolved,
whether by compensation or by repatriation. A solution of this
problem, in Mr. Byroade's view, would do more than anything else
to reduce the border violence. A fifth aspect of the problem was

«S6711 0—55 4

23

The Kasmie irrigation project, where American technicians are helping
Lebanon irrigate 1 2,000 acres.

that the quarrel which divided the Arab States and Israel was not
basically religious but essentially a nationalistic quarrel "such as
could arise with equal bitterness between two other peoples whose
national aspirations clashed." The final fundamental was one of
basic attitude — of superiority and contempt for the other on the one
hand and of negativism on the other. Mr. Byroade closed :

It is only with a decrease of immediate incidents along the borders and a
period of relative tranquillity that minds can turn to an honest approach to
more fundamental and underlying causes of this dispute. This atmosphere
one would hope would then be conducive to face the real and permanent
threat to the whole area. The peoples of the Middle East could then with-
out distraction devote more attention to the greater understanding of the real
goals of Soviet imperialism. With confidence established in their interrela-
tionships, all the states of the Middle East could concentrate and attend their
energies to safeguard the precious heritage of freedom to which we all dedi-
cate ourselves. For the plans of Communist imperialism envisage the total
destruction of the religions, cultures, and independence of us all. Each one

24

of us must make some sacrifice to attain the preservation of common free-
dom. The United States for its part has shown that it is wiUing and anxious
to go far toward making this a reality.

REPLY TO AMBASSADOR EBAN

In response to a protest from Israel Ambassador Abba Eban on
May 5, Mr. Byroade explained that he had spoken frankly on the
underlying causes of the Arab-Israel controversy because it seemed
to be increasingly affecting the security of the Middle East and,
hence, of the United States.^' The American people, in his view,
vv^ere entitled to such information, especially because of the new
evidence of Soviet intentions in the Middle East, but he regretted
that the Israel Government had interpreted his remarks on the
subject of immigration as an intervention in Israel's domestic af-
fairs. The Israel Government, he said, seemed to have overlooked
the basic point that the Arab world did have a fear of Israel expan-
sion, and he hoped that Israel would give serious attention to find-
ing a solution of the problem raised. His address, he said, had
merely stated that assurances by the great powers should be supple-
mented by Israel herself. Israel should find some way to lay at rest
this concern of her neighbors and thus remove the specter of fear —
which did not seem to him to be based upon reality — from minds
in the Middle East. Wise statesmanship might find a way to such
accomplishment.

Deputy Under Secretary Robert Murphy sounded much the same
note before the Zionist Organization of America on June 24.^'
Among other things, Mr. Murphy remarked that those in the De-
partment of State who regularly dealt with "ramifications of the
problem" were "affected by sympathy and desire to effect solu-
tions" in the interest "of the Jewish community and of our coun-
try." But there was "no desire improperly to interfere in the
internal affairs of any state."

It remained for President Eisenhower, speaking at the American
Jewish Tercentenary Dinner at New York on October 20,'*'* how-
ever, to state the essence of American policy :

In the Near East, we are all regretfully aware that the major differences
between Israel and the Arab States remain unresolved. Our goal there, as
elsewhere, is a just peace. By friendship toward both, we shall continue to
contribute to peaceful relations among these peoples. And in helping to

25

strengthen the security of the entire Near East, we shall make sure that any
arms we provide are devoted to that purpose, not to creating local imbal-
ances which could be used for intimidation of or aggression against any
neighboring nations. In every such arrangement we make with any nation,
there is ample assurance that this distortion of purpose cannot occur.

TENSION ALONG DEMARCATION LINES

While the United States in 1954 continued to pursue a poHcy of
impartial friendship in the Middle East, there was little indication
of any lessening of tension along the Israel-Arab demarcation lines
following the adoption by the U.N. Security Council of the resolu-
tion concerning the Qibya incident on November 24, 1953."^" Nor
was the Secretary-General of the United Nations, under article
XII of the Israel-Jordan Armistice Agreement of 1949, successful
in bringing Jordan and Israel together for a special conference at
the headquarters of the United Nations, since Jordan insisted that
the proper channel for discussion lay within the framework of the
United Nations Truce Supervision Organization, not the United
Nations Headquarters.'''

On February 24, 1954, Gen. Vagn Bennike, Chief of Staff of
the U.N. Truce Supervision Organization, submitted a report in
accordance with the November 24 resolution."* Among other
hings, he indicated that there had been no incidents comparable
with that at Qibya and that Jordan had taken measures to meet
the situation, including: (i) an increase in the number of police
assigned to the border area; (2) an increase in the number of
patrols; (3) replacement of village mukhtars and area commanders
where laxity was suspected; (4) removal from the border area of
suspected infiltrators and imposition of heavy sentences on known
infiltrators; and (5) effective measures, preventive and punitive,
to prevent incidents resulting from ploughing across the demarca-
tion line, although the Israel Government protested this inter-
pretation of the situation.

In the weeks which followed there was an increase in tension
along the demarcation lines. When the Israel-Jordan Mixed
Armistice Commission, under Commander E. H. Hutchison, found
it impossible to determine responsibility for an incident at Scorpian
Pass on March 17, 1954, in which 1 1 Israelis were killed, Israel re-

27

fused to cooperate with that body until Commander Hutchison
was replaced (October ii, 1954). A series of incidents followed
at Nahhalin on March 29, in which nine Jordanians were killed
and 17 wounded, the Jordan Government charging that an Israel
task force was involved.^^

Ambassador Eban called on Secretary Dulles on March 25 to
discuss Israel-Arab relations with particular reference to the inci-
dent at Scorpian Pass and existing border tensions. The Secretary
repeated his deep regret at the loss of life involved but pointed out
that the Israel-Jordan Mixed Armistice Commission had not been
able to identify the criminals and stressed the necessity for for-
bearance on the part of all parties and the avoidance of statements
or acts which might further disturb the general situation. He also
indicated that the United States fully supported the U.N. Truce
Supervision Organization and believed that both parties should
cooperate with the Mixed Armistice Commission. In particular,
the Secretary expressed his hope that Israel would cooperate with
the Israel-Jordan Mixed Armistice Commission in further efforts
to identify and bring the perpetrators of the ambush to justice.

In reply to Ambassador Eban's request that the United States join
the United Kingdom and France in bringing the situation to the
attention of the Security Council, Secretary Dulles stated that the
United States would exchange views with these Governments,
which, he understood, were also being approached by the Israel
Government. Mr. Dulles also stated his belief that both parties
should adhere faithfully to their obligations under the armistice
agreement of 1949 and said he hoped that they would cooperate
with the Mixed Armistice Commission in investigating all the facts
of the situation and that Jordan would live up to its obligations
under article XII of the armistice agreement.

The problem of frontier incidents and tensions came before the
Security Council during April and May, but there was no concrete
action.''" An outbreak of violence in Jerusalem, June 30-July 3,
1954, brought forth a message on July i from the United States to
both Jordan and Israel, in which the United States deplored the
outbreak, with its serious loss of life, and urged both Governments
to take immediate steps to insure observance of the cease-fire. The
United States also hoped that both Governments would cooperate
with the U.N. Chief of Staff in his efforts to terminate the clash."

28

Incidents continued throughout the summer, especially along
the Israel-Jordan demarcation lines, and shortly after becoming
Chief of Staff of the U.N. Truce Supervision Organization on Sep-
tember 2, 1954, Maj. Gen. E. L. M. Burns was impelled to complain
of lack of cooperation, particularly on the part of Israel.*^ In con-
nection with an incident in the Bayt Liqya area early in September,
he declared that the holding of military maneuvers in Israel near
the demarcation lines increased anxiety on the other side. It was
necessary —

that the Governments should keep the situation well in hand, that they should
take all possible measures to avoid incidents, that illegal crossings of the de-
marcation line should be as far as possible prevented, that only well-trained
and disciplined military or police personnel be employed in the first line of
the defensive organizations of both parties, particularly in the sensitive areas
like the Jerusalem area.

COMPLAINT AGAINST EGYPT

Meanwhile, on January 28, 1954, Israel had urgently requested
the Security Council to consider its complaint against Egypt con-
cerning (i) restrictions on the passage of ships trading with Israel
through the Suez Canal and (2) Egyptian interference with ship-
ping proceeding to the port of Eilat on the Gulf of Aqaba, in al-
leged violation of the resolution of the Security Council of Sep-
tember I, 1951, and of the Egyptian-Israel General Armistice
Agreement of February 24, 1949.''^ The Security Council consid-
ered the Israel complaint in eight sessions between February 4 and
March 29. During the discussion on February 5 Ambassador Eban
noted the importance of the problem of freedom of the seas and
of fidelity to international conventions and accused Egypt of estab-
lishing a general blockade against Israel in violation of the resolu-
tion of September i, 1951, and of the Constantinople Convention of
1888, under which the Canal was to be "always free and open in
time of war as in time of peace to every vessel of commerce or of
war without distinction of flag." In turn, the Egyptian representa-
tive stressed that Egypt was not employing a blockade or interfer-
ing with freedom of commerce but was exercising the right of
search as a matter of self-defense, since the armistice of 1949 had
not brought peace.

29

At the close of the discussion a resolution submitted by New
Zealand was brought to a vote. It recalled the resolution of 1951,
noted with "grave concern" that Egypt had not complied with it,
and called upon Egypt to remove restrictions on Suez Canal traffic.
It also indicated that the Egyptian-Israel Mixed Armistice Com-
mission should deal with the problem of transit of Aqaba. While
eight representatives, including Ambassador Lodge of the United
States, supported the resolution, the Soviet Union and Lebanon
opposed, with the Soviet vote constituting a veto.*^

The problem of the Suez Canal came before the Security Council
again between October and December 1954, on a complaint by
Israel that on September 28 Egypt had seized an Israel vessel, the
SS. Bat Galim, which was involved in a test of the Egyptian re-
strictions in the Suez Canal. While the discussion of the question,
except for the specific application, was along the lines which had
become familiar both in 195 1 and in the winter and spring of 1954,
no decision emerged. On December 4, however, the Egyptian
Government indicated that it was preparing to release the crew of
the Bat Galim as soon as the necessary formalities had been com-
pleted, and was ready to release the seized cargo immediately."

The Egyptian Government announced its intention to release the
Bat Galim on December 23, and on January i it did release the
crew. During the further discussion of the case on January 4, 1955,
in the Security Council, Ambassador Lodge indicated that the
"sole desire" of the United States was "to see a just and equitable
settlement of the outstanding problems between Israel and her
neighbors." He said he did not believe that this could be accom-
plished "without strict adherence by both sides to the decisions of
the Security Council, taken in accordance with its responsibilities
for the maintenance of peace and security, and strict adherence to
the provisions of the armistice agreements." He also declared that
Egyptian restrictions on transit of ships through the Suez Canal,
whatever the direction or the flag, were "inconsistent with the spirit
and intent of the Egyptian-Israeli General Armistice Agreement,
contrary to the Security Council resolution of September i, 1951,
and a retrogression from the stated objectives" to which both sides
were committed in signing the armistice agreement. Ambassador
Lodge hoped that both Israel and Egypt would take further steps
to reduce tensions and believed there had been some lessening of
tension in connection with the Palestine question during 1954.

30

Meanwhile, the Arab States had all protested against the plans
for the presentation at Jerusalem of the credentials of the new
American Ambassador to Israel, Edward B. Lawson. The Arab
chiefs of mission in Washington charged on November 3 that
such presentation would constitute a change in the previous United

Arab refugees — their future remains unresolved.

States attitude concerning Jerusalem and would be in disregard of
"the reaffirmed United Nations resolution on the internationaliza-
tion of the Jerusalem area." " In the course of the conversation,
however, Secretary Dulles recalled the policy of the United States
to look to the United Nations and stated that, following normal
practice, the presentation of credentials would be effected by Am-
bassador Lawson at the place where the Chief of State actually
330711 0—55 — —5

31

was. The fact that presentation would take place in Jerusalem im-
plied no change in the United States attitude regarding Jerusalem,
he said, nor did it imply any change in the location of the Ameri-
can Embassy in Israel, which was at Tel Aviv. When Ambassador
Lawson presented his credentials on November 12, he expressed the
hope that the friendship between the United States and Israel
would be strengthened and said he considered it fitting that Amer-
icans, who owed so much of their civilization to the inspiration of
the prophets of Israel, should work together with Israel "in the
great task of building a modern nation in this ancient land."

GENERAL ASSEMBLY DISCUSSION

The problems of Palestine did not figure prominently in the
deliberations of the ninth session of the General Assembly. With
the exception of brief reference in the general debate, there was no
mention of the political issues. In general, the Arab delegations
held to implementation of previous U.N. resolutions as a condi-
tion of peace with Israel, and the Syrian delegation, in particular,
suggested establishment of a commission to consider the question
of the repatriation of refugees, the problem of Jerusalem, and
territorial questions.*" On the other hand, Ambassador Eban of
Israel, speaking on October 6, considered the Syrian proposal
"frivolous" and suggested, as a step on the road to peace in the
Middle East, the conclusion of pacts of nonaggression and pacific
settlements, which would include undertakings to respect the ter-
ritorial integrity and political independence of signatories and to
refrain "from all hostile acts of military, economic or political char-
acter." "

There was considerable discussion of the problem of the Arab
refugees from Palestine, now numbering some 950,000. In the
end, in a resolution which the United States fully supported. United
Nations assistance was extended for a period of 5 more years."'
Likewise approved was a $26,100,000 allocation to assist in feeding
and caring for the refugees and $36,200,000 more to promote land
development and other works programs designed to make the
refugees self-sufficient.

The United States fully supported the program, and Ambassador
James J. Wadsworth explained on November 19 that the United

32

States approved extension of the Relief Agency for another 5
years, if the Sinai reclamation project, the Jordan-Yarmuk project,
and others were begun very soon. But if prompt action were not
forthcoming, the attitude of the United States would "inevitably
undergo thorough reexamination, as its willingness to continue
its support" would "in all probability be based on tangible evidence
of progress on the programs of public works within a reasonable
time." On November 24 he declared that the resolution clearly
reaffirmed the right of the refugees to repatriation and indicated
his belief that Israel "ought to satisfy one or the other of the two
rights" of repatriation and compensation, although the United
States also considered it "essential that the refugees understand
that the true destiny of most of them lies in the Arab world."

North African Problems

Because of its concern with broad questions of security and of
the well-being and progress of the peoples of the area, the United
States maintained its interest in the problems of North Africa dur-
ing 1954. During his visit to the United States in November,
French Premier Pierre Mendes-France reviewed events in North
Africa which had "created obstacles to the policy inaugurated by
the French Government." But he expressed the hope that French
proposals would lead to a prompt solution of the problems and
stressed that "external influences" had "affected the situation in
North Africa and compromised the security" of North Africa.
Secretary Dulles declared that he "would give serious consideration
to the matter." In an address to the General Assembly of the
United Nations on November 22, Premier Mendes-France referred
in particular to the problem of Tunisia and to the negotiations
looking toward the laying of "foundations of a lasting agreement."

After a brief discussion of the problems of Tunisia and Morocco,
the General Assembly decided, on December 17, to postpone con-
sideration "for the time being" and expressed confidence that a
satisfactory solution would be found.^ The United States had
preferred to have no resolution on the question of Tunisia in Com-
mittee I but did support the ultimate resolution in the plenary

33

session, since it expressed confidence that the French and Tunisian
Governments were working toward a successful solution of that
problem.^^

The Problem of Mutual Security

On March 8, 1954, President Eisenhower noted that a series of
new and vital measures to promote the defense capabilities, eco-
nomic strength, and technical advance of the peoples of the free
world had marked the progress of the mutual security program
during the latter part of 1953, and he laid stress on the program for
technical cooperation in the underdeveloped areas where living
standards were very low."'' It was "essential to any forward eco-
nomic movement that effective steps be taken to improve world
living standards by increasing the real wages of the worker, and
by achieving higher productivity and greater output to meet the
expanding purchasing power." Among other things, the Presi-
dent called attention to the assistance given to Iran since August
1953, and to wheat shipments to Pakistan, Jordan, and Libya.

On June 23, the President submitted his recommendations on
the mutual security program for the fiscal year 1955,"" calling for
a program involving about $3,500,000,000 — a reduction of about
40 percent in 2 years — some 70 percent of which was for military
programs. Approximately $256,400,000 was for development as-
sistance largely in the Near East and South Asia, with a grand
total of $570,000,000 to be allocated to the area of the Near East,
South Asia, and Africa as a whole. Among other things, the Presi-
dent declared that American participation in technical cooperation
programs must be "vigorously advanced." " The appropriation
bill of August 19, 1954, provided a total of $2,781,499,816, of which
$73,000,000 was designated for defense support in the general area
of the Near East, South Asia, and Africa, including Greece and
Turkey, and $115,000,000 for development assistance in the Near
East and Africa, with an additional $60,500,000 for South Asia."*

The current figures and estimates, however, should be placed
in the perspective of the total of American assistance since 1941, in
general, and more particularly since the end of the Second World
War. Between 194 1 and the end of fiscal year 1955 the total of
American grants and credits was to reach some $87,000,000,000,

34

while the gross total since July i, 1945, has reached approximately
$49,600,000,000, with a net of some $47,901,000,000. For the area
of the Near East, South Asia, and Africa since 194 1 the figure has
reached almost $4,000,000,000 gross, or about $3,000,000,000 net.
The net distribution of grants and credits between July i, 1945,
and September 30, 1954, was approximately as follows:

Summary of Foreign Grants and Credits (ig^^-ig^^)

frreece $1,235,000,000

Turkey 266, 000, 000

Egypt II, 000, 000

Iran 124,000,000

Israel 333, 000, 000

Liberia 23, 000, 000

Saudi Arabia 15,000,000

India 275, 000, 000

Pakistan 103,000,000

Afghanistan 39, 500, 000

Near East and Africa (unspecified) 123, 000, 000

Total $2, 547, 500, 000

Moreover, it may be noted that during the fiscal year 1954 funds
programed under the mutual security program for the Near East,
South Asia, and Africa reached $840,900,000. Of this amount
$541,700,000 was allocated for military assistance, direct forces-
support, and defense support, Greece and Turkey being the major
recipients, while $34,500,000 was included for defense support in
Pakistan. For development assistance programs, $208,600,000 was
programed for this period, of which Afghanistan received
$1,500,000, India $60,500,000, Iran $71,500,000, Israel $52,500,000,
Jordan $8,200,000, Lebanon $6,000,000, Libya $385,000, and the
African overseas territories of Western Europe $8,000,000. Of the
remaining $90,600,000, $75,600,000 was programed for technical co-
operation and $15,000,000 for the Palestine refugee program."" The
program for 1954-1955 allocated some 60 percent of its funds in
South Asia and the Far East, about 30 percent being earmarked
for economic and technical assistance in order to meet the Com-
munist menace on the long-range testing ground of social and
economic development. Among other things, it is noteworthy

35

that economic assistance to both Pakistan and Iran was sharply
increased and that for the first time economic assistance over and
above technical aid was extended to Arab States.

Some New Approaches to
Regional Security

In the light of Secretary Dulles' report of June i, 1953,"^ follow-
ing his visit to the Middle East, some new approaches were made
to the problem of regional security in that area during 1954. Tur-
key, Iraq, and Pakistan were all elements in the new approach
toward strengthening the area as a whole. In the end, it may be
noted, Turkey and Pakistan signed an agreement for friendly co-
operation, while the United States signed mutual defense assistance
agreements with both Iraq and Pakistan.''^

In an address to a joint session of the United States Congress on
January 29, 1954, during his visit to the United States, President
Celal Bayar of Turkey declared that the extension of American
military and economic assistance to peace-loving countries had "no
parallel in the history of the world, either in essence or in quan-
tity," and he was convinced that the significance of this action
would "be recorded in history as the most important event of the
post World War II period." President Bayar also pointed to the
Turkish contributions to the strength of the free world, particularly
in Korea, and noted its membership, together with Greece, in the
North Atlantic Treaty Organization. It would be equally appro-
priate, he remarked,

to stress in this connection that in accordance with principles set forth in
the charter of the United Nations, Turkey has sought to fill in the gaps exist-
ing in the peace front. The Tripartite Balkan Pact which was signed last
year between Greece, Turkey, and Yugoslavia is clear evidence of how strong
barriers can be set up by realistic and resolute states united in a sincere desire
for peace. This pact has simultaneously set a new and fine example in the
application of the rights and principles of self-defense for the preservation of
peace as recognized by the charter of the United Nations and contributed to
its consolidation.

On February 19, the United States warmly welcomed the an-
nounced intention of Turkey and Pakistan "to study methods of

36

achieving closer friendly collaboration in the political, economic,
and cultural spheres as well as of strengthening peace and secu-
rity in their own interest as also in that of all peace-loving na-
tions." It was felt that this "forward-looking step" would pro-
vide increased assurances that these and other nations would be
able to maintain their independence, since no nation, standing
alone, could "obtain adequate security at bearable cost." This
principle had been accepted and applied throughout most of the
free nations of Europe, North and South America, and the West-
ern Pacific, and it seemed obvious that the projected pact between
Turkey and Pakistan constituted "a constructive step toward the
broadening of the base of the collective strength of the free world."

U. S. MILITARY ASSISTANCE TO PAKISTAN

President Eisenhower indicated on February 22 that considera-
tion was being given to the extension of military assistance to
Pakistan.''" In accordance with the President's report to Congress
on June 30, 1953, in which he had stated that the United States
should "strengthen the efforts towards regional political, military,
and economic integration," the President was now complying with
a request of the Government of Pakistan for military aid, sub-
ject to the negotiation of a military defense assistance agreement.
The United States had been "gravely concerned" with "the weak-
ness of defensive capabilities in the Middle East," and the Presi-
dent made it clear that the United States would be guided by the
purposes and requirements of the mutual security legislation, which
declared specifically that the equipment, materials, or services
provided would be used "solely to maintain the recipient country's
internal security and for its legitimate self defense, or to permit
it to participate in the defense of the area" of which it was a part.
Moreover, any recipient would also have to undertake that it would
not "engage in any act of aggression against any other nation."
These undertakings, it was thought, afforded "adequate assurance
to all nations, regardless of their political orientation and what-
ever their international policies," that the arms which the United
States provided would "in no way threaten their own security." If
such aid were misused, the President would undertake immedi-
ately, in accordance with his constitutional authority, "appropri-

37

On parade: Graduation ceremonies at the Pakistani Military Academy, which
will provide part of strength behind the Manila Pact to prevent aggression
in southern areas of Asia,

ate action both within and without the UN to thwart such ag-
gression" and would consult with the Congress concerning further
steps. The President concluded :

The United States earnestly desires that there be increased stability and
strength in the Middle East, as it has desired this same thing in other parts
of the free world. It believes that the aspirations of the peoples in this area
for maintaining and developing their way of life and for realizing the social
advances close to their hearts will be best served by strength to deter aggres-
sion and to reduce the fear of aggression. The United States is prepared to
help in this endeavor, if its help is wanted.

38

In view of Indian misgivings, the President also sent a letter to
Prime Minister Pandit Jawaharlal Nehru on February 24, 1954/''
since he wanted Mr. Nehru to know of the decision to extend
military assistance to Pakistan before it became public knowledge.
He also wanted him to know that the step did "not in any way
affect the friendship we feel for India" and that the United States
would "continually strive to strengthen the warm and enduring
friendship between our two countries." The President told Mr.
Nehru that he believed that Turkish-Pakistan consultation con-
cerning security problems would "serve the interests not only of
Pakistan and Turkey but also of the whole free world." Improve-
ment of the defensive capability of Pakistan would also serve these
interests. Nor was it in any way directed against India. If the
assistance were misused and "directed against another in aggres-
sion," the President declared that, in accordance with his consti-
tutional authority, he would take appropriate action immediately,
both within and outside the United Nations, to thwart such ag-
gression. But he believed that the Turkish-Pakistan agreement
which was being discussed was "sound evidence of the defensive
purposes" which both countries had in mind. The President also
referred to Indian interest in the need for economic progress as a
"prime requisite for stability and strength" and to American as-
sistance to India, the continuation of which he was recommending.
But he also believed that India should have a "strong military de-
fense capability," and to emphasize that the assistance to Pakistan
was not directed against India, the President said that he was pre-
pared to give sympathetic consideration, if India desired assistance
of a type contemplated under the mutual security legislation in the
United States.

Turkey and Pakistan signed an agreement for friendly coopera-
tion on April 2, reaffirming, among other things, their faith in the
purposes and principles of the United Nations, and pledging that
they would refrain from entering into any alliance or activities di-
rected against the other and would not intervene in domestic mat-
ters." They were to consult on international matters of mutual
interest and develop their cooperation in the cultural, economic,
and technical fields. Under article IV of the agreement, consulta-
tion and cooperation were to cover (i) exchange of information
on technical matters; (2) endeavors to meet the requirements in

39

production of arms and ammunition; and (3) studies of the prob-
lem of the "cooperation which might be effected between them in
accordance with article 51 of the Charter of the United Nations,"
in the event of an unprovoked armed attack. Each declared that
none of its engagements then in force conflicted with the obliga-
tions of the new treaty and that no conflicting ones would be under-
taken. There was also provision for accession to the treaty, which
was to endure for a period of 5 years and, unless denounced, to
remain in force for an additional 5-year period.

A few weeks later, on April 21, in response to an Iraqi request
of March 1953, the United States and Iraq signed an agreement for
American military assistance to strengthen Iraq's forces for the de-
fense of its territory against possible aggression. Included in the
understanding was a provision that assistance would be provided
"subject to the provisions of applicable legislative authority" and
"related in character, timing and amount to international develop-
ments in the area." In the State Department's announcement of
April 26,°* it was indicated that the President's statement of Febru-
ary 25 with regard to Pakistan gave "general background on the
subject of United States policy with respect to U.S. military as-
sistance to certain countries of the Near and Middle East."

Negotiations now moved forward quickly to the signature, on
May 19, of the Mutual Defense Assistance Agreement with Pak-
istan."" Among other things, the new agreement contained an in-
teresting preambular reference to article 51 of the United Nations
Charter, in connection with fostering "international peace and se-
curity within the framework of the Charter of the United Na-
tions" through measures which would "further the ability of
nations dedicated to the purposes and principles of the Charter to
participate effectively in arrangements for individual and collec-
tive self-defense in support of those purposes and principles." It
also reaffirmed the determination of the two governments —

to give their full cooperation to the efforts to provide the United Nations with
armed forces as contemplated by the Charter and to participate in United
Nations collective defense arrangements and measures, and to obtain agree-
ment on universal regulations and reduction of armaments under adequate
guarantee against violation or evasion.

Under article I the parties agreed that the furnishing and use of
assistance should be "consistent with the Charter of the United
Nations" and that Pakistan would "use this assistance exclusively

40

to maintain its internal security, its legitimate self-defense, or to
permit it to participate in the defense of the area, or in United Na-
tions collective security arrangements and measures" and would
"not undertake any act of aggression against any other nation."
Nor was it, without prior agreement with the United States, to
devote American assistance to purposes other than those for which
the assistance was furnished. Consistent with the United Nations
Charter, Pakistan was to furnish the United States, or such other
governments as the parties might agree upon, such equipment, ma-
terials, services, or other assistance, as might be agreed upon to in-
crease their capacity for individual and collective self-defense, and
"to facilitate their effective participation in the United Nations
system of collective security."

Prime Minister Adnan Menderes of Turkey, during his visit to
the United States in June, had occasion to place before the
United States a clear statement of Turkish policy to act as a con-
vinced and determined member of the North Atlantic Treaty
Organization, to develop closer political and military bonds with
other friendly nations in the free world, and to support "the mutual
efforts of the United States and other free nations to organize for
world security." The official visit of the Turkish Prime Minister
also provided an opportunity to discuss the heavy strain on Turkish
resources and to survey the problem of further assistance. It was
indicated that the United States intended to continue to base its
program of military assistance on the concept of helping Turkey
to meet its goals in the North Atlantic Treaty Organization. Sub-
ject to congressional action and a review of American commit-
ments and priorities, the United States was disposed to increase its
military defense program. It was also prepared "to accelerate
deliveries of items in the present pipeline of roughly one-half billion
dollars of military equipment presently appropriated and pro-
grammed for Turkey." In view of the Turkish situation, funds
had been requested of Congress to permit the furnishing of eco-
nomic assistance to Turkey during fiscal year 1955. It was an-
nounced on June 15 that an allotment of $30 million had been made
to provide the Turkish armed forces with jet fuel, lubricants, tires
and batteries, and clothing." The allotment was in addition to
support already given in direct military assistance and to $46 mil-
lion previously allotted in defense support funds to bolster Turk-

41

ish defenses. The Foreign Operations Administration pointed to
the economic development of Turkey since 1948, indicating that,
together with the June 15 allotment, the United States had pro-
vided $353 million in economic assistance, in addition to the mil-
lions in direct military assistance.

By the time of the visit of Prime Minister Mohammed Ali of
Pakistan in Washington in October, Pakistan had not only signed
its treaty with Turkey and its Mutual Defense Assistance Agree-
ment with the United States but had also become a signatory to
the Southeast Asia Collective Defense Treaty (September 8, 1954).^*
During the course of his visit, the United States and Pakistan re-
affirmed "their common purpose in striving to assure peace and
economic security to their peoples," expressing the conviction that
these objectives can be attained "through measures of collective
security, self-help and economic cooperation." They also shared
a conviction that these goals can be attained "only where funda-
mental spiritual values are permitted to flourish." During the
Prime Minister's discussions with the President, Secretary Dulles,
Secretary of Defense Wilson, and Foa Director Stassen, the special
position of Pakistan in the Middle East and Southeast Asia was kept
in mind. In the end it was agreed that the United States would
make available to Pakistan during the fiscal year 1955 approxi-
mately $105 million in additional economic assistance, part of it
in the form of loans. Moreover, in view of the military defense
agreement with Pakistan, the military assistance program was to
be accelerated, although the United States could not make commit-
ments beyond the limits of existing and current appropriations.

THE TRIPARTITE TREATY OF GREECE,
TURKEY, AND YUGOSLAVIA

The United States also observed with considerable interest the
moves of Greece, Turkey, and Yugoslavia toward the consolida-
tion of defense arrangements in the Balkan area, not only because
of its concern for the security of this region, involving the Adriatic,
the Aegean, the Turkish Straits, and the Eastern Mediterranean,
but also because Greece and Turkey are active members of the
North Atlantic Treaty Organization. Other members of Nato
were interested in the problem, also, in view of possible implica-

42

tions with regard to their commitments. Moreover, Italy, which
was still in controversy with Yugoslavia concerning the problem
of Trieste, was especially concerned with the development of a new
Balkan entente.

After negotiations which followed the initial treaty of Febru-
ary 28, 1953, the Treaty of Alliance, Political Cooperation, and
Mutual Assistance was signed on August 9, 1954, at Bled, Yugo-
slavia." Under it the parties reasserted "their fidelity to the prin-
ciples of the United Nations Charter and their desire to contribute
to the maintenance of international peace and security." They
expressed their resolve "to insure, in the most efficacious manner,
the territorial integrity and political independence of their coun-
tries," in accordance with the principles of the United Nations
Charter.

The body of the treaty consisted of 14 articles. According to
article i, in conformity with the United Nations Charter, the parties
committed themselves to settle all international disputes by peace-
ful means and to abstain from the threat or use of force in any way
inconsistent with the aims of the United Nations. Article 2, which
bore a close resemblance to the formula used in the North Atlantic
Treaty, contained the essential security commitment undertaken
by Greece, Turkey, and Yugoslavia:

The contracting parties have agreed that any armed aggression against
one, or several of them, at any part of their territories, shall be considered
as an aggression against all the contracting parties, which, in consequence,
exercising the right of legitimate collective defense recognized by Article 5 1
of the United Nations Charter, shall individually in common accord and
immediately take all measures, including the use of armed force, which
they shall deem necessary for efficacious defense."

Moreover, under the reservation of article 7, the parties were not
to conclude peace or any other arrangement with an aggressor
without prior agreement among themselves. To assure imple-
mentation of the treaty, the parties were to "extend each other'
mutual assistance in order to maintain and strengthen their de-
fensive capacity."

Provision was also made in the treaty, under article 4, for the
establishment of a Permanent Council of the Foreign Ministers
and of other members of the Governments concerned, to be con-
vened twice a year, or more often, if necessary. When not in ses-

43

sion, the Permanent Council was to exercise its functions through
the Permanent Secretariat, which had been estabUshed under the
treaty of February 28, 1953. Decisions of the Permanent Council,
which replaced the Conference of Foreign Ministers, were to be
unanimous. In the event of aggression, according to article 5,
there was to be immediate consultation, and the Permanent Coun-
cil was to meet urgently "to determine the measures which were to
be undertaken," in addition to the measures taken under article 2
to meet the situation.

The parties were also to consult, under article 6, in the event
of a "grave deterioration of the international situation," especially
if it involved the security of Southeastern Europe. Conscious that
an armed aggression "against a country other than themselves"
could involve their own security either directly or indirectly, the
parties agreed to

consult each other on the measures to be taken, in conformity with the aims
of the United Nations, to meet the situation that would thus have been created
in their area.

But it is interesting to note that, according to article 7, the United
Nations Security Council was to be informed immediately of the
aggression and of the defense measures taken, which were to be
halted when the Security Council, under article 51 of the charter,
had "taken the measures necessary to maintain international peace
and security." Similarly, without delay, the parties were to make
the declaration foreseen by the resolution of the General Assembly
of the United Nations of November 17, 1950, on the duties of states
in the event of the outbreak of hostilities and act in conformity
therewith.'"

The parties also reiterated their pledge against participating in
any coalition directed against any one of them and against under-
taking any commitments incompatible with the provisions of the
tripartite treaty. The treaty (article 9) was not to affect the rights
and obligations of the parties under the United Nations Charter,
nor to be so interpreted. Similarly, it was not to affect the rights
and obligations of Greece and Turkey under the North Atlantic
Treaty Organization, nor to be so interpreted (article 10). Insofar
as unaltered, the treaty of February 28, 1953, remained in force, and
the alliance was to have the same duration. The treaty of alliance
was concluded for a period of 20 years and, if not denounced i year

44

prior to expiry, was to be prolonged until denounced by one of the
parties. It was to be ratified according to the constitutional pro-
cedures of the parties and to enter into force on the date of the
last ratification."

One of the important developments which followed the Greek-
Turkish-Yugoslav agreement, although it was not inherently inter-
related with it, was the initialing on October 5 of the Yugoslav-
Italian agreement settling the complex problem of Trieste." The
United States was very much interested in this settlement both for
its encouragement of more friendly Italo- Yugoslav relations and
for its contribution to the defense of the area. Both Greece and
Turkey, not to mention others, meanwhile, considered the new
Balkan Pact as an important contribution to the defense of the
Eastern Mediterranean and the periphery of the Near and Middle
East, based upon a realistic consideration of the essential security
interests of the three participants.

U.S. Technical and Economic
Assistance Programs

There was continued recognition in 1954 of the importance of
technical and economic assistance, especially in underdeveloped
areas. While the basic agreements for technical cooperation be-
tween the United States and the countries of the Near East, South
Asia, and Africa were reached during the period of 1950-1951,
there have been many specific agreements since that time.

In an address of May 24, 1954, Mr. Stassen noted that there were
more than 1,800 American technicians serving in 42 countries, and
that it was hoped that there would be no less than 2,500 by the end
of 1954. Thirty-five contracts had been signed with American uni-
versities and colleges, and agreements had been reached with 113
professional societies and commercial organizations to provide
specific technical services abroad.™

A few examples may serve as illustrations of the kinds of projects
carried out during 1953-1954.

45

GREECE, TURKEY, AND IRAN

Since 1947, Greece and Turkey have been the subject of special
assistance programs designed to strengthen their defensive posi-
tions and preserve their territorial integrity and political independ-
ence along the northern ramparts of the Near and Middle East.

Thanks to American economic assistance and to the efforts of the
Greek people themselves, Greek industrial production had risen by
1954 some 66 percent above prewar levels, while agricultural output
was up 42 percent. Greek development projects receiving U. S.
financial assistance in 1954 included an integrated national electric
power system, improvements in land and water resources, an indus-
trial loan program of $80 million, and projects involving mines,
highways, railroads, education, and health. During the first part
of the year a major unit of the power system was put into operation
and the entire system was to be completed by the end of 1954. De-
fense support funds to Greece were reduced from $179 million in
1952 to $2 1 million in 1954.*°

The program in Turkey looked toward the development of do-
mestic industries, either to expand exports or to produce more com-
modities for home consumption. The basic problem since 1947 has
been the question of supporting the Turkish defense forces — the
requirements of which have exceeded Turkey's resources — and of
proceeding simultaneously with the expansion of the economic
base. During the first half of the year 1954, $46 million was made
available for defense support projects, the funds being used essen-
tially to finance procurement of equipment to increase hydroelec-
tric power in industrial areas, develop the highway system, and
improve grain storage and handling facilities. Steps were also
taken to provide equipment for both agricultural and mining de-
velopment, and for the development of manufacturing.*^

The United States has also had significant technical assistance
programs in operation in Iran. U. S. emergency economic assist-
ance amounted to $45,000,000 during the latter part of 1953, and an
additional $15,500,000 was provided in the first half of 1954 to
maintain the flow of essential imports. The technical cooperation
and development assistance programs were intended to remedy
basic weaknesses in the economic and social structure of Iran.
Thus, during the 12-month period ending June 30, 1954, $24,000,000

46

was obligated to 48 projects in health, agriculture, education, indus-
try, communications, and public education, with the full participa-
tion of the Iranian Government, which has provided the equiva-
lent of more than $18,000,000 since 1952 for joint projects in techni-
cal cooperation. Five American universities, moreover, were
cooperating, under the Foreign Operations Administration, in
projects for agricultural development and education.*^

The United States announced on November 2 that, since it would
be 3 years before Iran's oil revenues would again enable it to
finance large-scale development, the United States was ready to
assist with loans and grants totaling $127,300,000 from the Export-
Import Bank and the Foreign Operations Administration. The
total included $21,500,000 for technical assistance, $52,800,000 for
consumer-goods imports, and $53,000,000 for short-term develop-
mental assistance.*'^

THE NEAR AND MIDDLE EAST

Israel received large-scale private and official assitance from the
United States during the period of 1953-1954. The mutual secu-
rity program in Israel shifted from emergency supply to basic de-
velopment projects, grant funds having been gradually reduced.
Thus, about 20 percent of Israel's imports were financed by United
States grants during the fiscal year 1954 as compared with 35 per-
cent in 1953. More than $32,000,000 of the $52,500,000 made avail-
able to Israel in the fiscal year 1954 was used to finance imports of
food, fuel, fertilizer, raw materials, and agricultural and industrial
machinery, the remainder being devoted essentially to projects in
agriculture, industry, and mining. Most of the $1,500,000 in tech-
nical cooperation funds was used for projects in agriculture and
natural resources.**

The Foreign Operations Administration announced on May 26,
1954, that an emergency shipment of six tons of garden seed was
to be sent via air to Iraq on May 27."'' The March rains had
brought the worst floods in the Tigris River valley in almost 50
years, and this was the first installment of a 25-ton shipment to
assist farmers whose spring plantings were washed away. It was
estimated that some 3 million acres had been flooded and some

47

500,000 people displaced or rendered homeless, with property
damage reaching approximately $80 million.

Meanwhile, plans were being made by the Iraq Development
Board to provide water by 1961 for 1,000,000 acres of new land, and
supplemental water for another 1,000,000 acres now under culti-
vation. The Board was established in 1950 to implement develop-
ment programs financed largely by Iraqi oil revenues. The Ameri-
can representative on the Board, and American technical experts,
have assisted in planning dams, irrigation systems, hydroelectric
plants, and flood-control works. Some 50 Iraqi "county agents" are
already working in the field, under American supervisors, and a
more extensive training program has been established.**"

In Jordan, the first basic grant economic assistance agreement
between the United States and an Arab State was signed at Am-
man on May 13," complementing the general technical assistance
agreement of February 1951. The agreement provided for Ameri-
can contributions to capital development projects, those under con-
sideration being in the general fields of irrigation, exploration and
utilization of ground water, afforestation, and road construction.
On June 28 the Foreign Operations Administration announced
allotment of $8 million in support of Jordan's program for better
roads, more water, improved crops and livestock, and restoration
of forest lands.*^ About one-half of this American assistance was
to be in the form of raw and processed agricultural commodities
to be sold in Jordan for local currencies that would help finance
the development projects. The rest was to cover the costs of engi-
neering and technical services and imported equipment.

Meanwhile, in cooperation with American specialists, the Jor-
danian Government had established 250 acres as demonstration
plots for some 42 varieties of grasses and vegetables. About 5,000
acres of land had been rendered productive through water-spread-
ing techniques, some 3,000 acres having been seeded to grass, grain,
and forage crops.

Egypt, another large beneficiary of American assistance, had been
allotted some $13,000,000 in technical assistance during fiscal year
1953 for a program devoted essentially to agricultural projects.
On July 22, 1954, the Foreign Operations Administration an-
nounced a new demonstration project of the Egypt-American
Rural Improvement Service, designed to reclaim some thousands
of acres in the Fayum Province for the settlement of landless

48

families.*' It was estimated that 2,000 families would be settled on
13,000 acres in the Qoota area. Among other things, existing
irrigation works were to be improved, and new drains, pumping
stations, and canals constructed, with the United States contribut-
ing $230,440 to the total cost of $576,100, and the Egyptian Gov-
ernment the equivalent of $345,600.

Technical assistance to Lebanon was continued. Among the
projects was one for irrigation in the Kasmie area."" The major
portion of the project, for the irrigation of 12,000 acres, is being
undertaken by Lebanon, with American technicians assisting in
canal construction. During the first part of 1954 an American-
financed survey of the Litani River was completed and final reports
prepared. It was estimated that development of the Litani River
would generate some 168,000 kilowatts of electric power, supply
100 villages with water, and irrigate more than 50,000 acres of land.

In addition to technical assistance, a program of economic aid
was inaugurated in Lebanon during 1954. The U.S. contribution
is $6 million and the projects are in the fields of agricultural pro-
duction, road construction, and village water supply.

On, the other hand, it was announced on October 17 that the
United States had closed its foreign aid mission in Saudi Arabia at
the request of the Saudi Arabian Government. The United States
had had a 30-member mission in Saudi Arabia, beginning opera-
tions in 1952 with a $2 million annual program designed as a plan-
ning and operating program. The planning stage had been fairly
well completed. With an estimated income of some $200 million
per annum, the Saudi Arabian Government indicated that it could
finance its own technical assistance.

But the United States was also concerned with the broader, re-
gional approach to economic problems in the Near East, and it
continued its interest in the development of the hydroelectric and
water resources of the Jordan River Valley. Ambassador Eric
Johnston, who had received comments from Israel and the Arab
States on the program for Jordan Valley development which he had
submitted in November 1953, conferred once more on the problem
in Cairo and Tel Aviv in June 1954."^ The development program
envisaged the construction of an integrated system of engineering
works designed to irrigate approximately 250,000 acres of land and
develop more than 60,000 kilowatts of electricity. Among the peo-
ples benefiting from such a system would be a substantial number

49

of the Arab refugees from Palestine who had been on relief since
the end of the Palestine conflict in 1948.

Returning from his survey, Ambassador Johnston informed
President Eisenhower and Secretary Dulles on July 6 that Jordan,
Lebanon, Syria, and Israel had accepted the "principle" of inter-
national sharing of the Jordan waters and were "prepared to co-
operate" with the United States "in working out details of a mu-
tually acceptable program for developing the irrigation and power
potentials of the river system/""^ After a 4-week visit to the
Middle East, he declared that the attitudes of these states "clearly
indicated a desire to evolve a workable plan for economic develop-
ment of the Jordan Valley despite the difficult political issues out-
standing between Israel and the Arab countries," and he was en-
couraged to believe that an early understanding concerning the
program was "now a possibility."

The plan embodied acceptance of the following principles by
Israel and the Arab States concerned :

1. Equitable sharing of the limited waters of the Jordan River
system by the four states ;

2. Establishment of a neutral, impartial authority to supervise
withdrawals of water from the river system in accordance with the
division ultimately accepted by all parties ;

3. Amelioration of the condition of the Arab refugees from
Palestine as a principal objective of the Jordan Valley irrigation
program ;

4. Achievement of an understanding concerning the total pro-
gram, at the earliest possible time, both in the interest of the Arab
refugees and in the interest of economic progress and stability in
the area ;

5. Open-minded consideration of the storage of irrigation waters
in Lake Tiberias (Sea of Galilee), when progress in developing
the valley indicated the necessity of using the lake as a primary
reservoir.

But while these principles formed a "solid basis" for further dis-
cussions, Mr. Johnston reported that there were specific points on
which differences would have to be reconciled before the valley
project could be realized. All concerned had requested that "the
Government of the United States continue to exercise its good
offices in reconciling these outstanding differences."

50

SOUTH ASIA

In a modest program in Afghanistan, involving some $1,500,000,
emphasis was placed on technical assistance in the development
and settlement of the Helmand River Valley. In addition to its
regular program, however, on March 20 the United States agreed
to sell, under section 550 of the Mutual Security Act, 12,000 tons of
wheat or flour to Afghanistan for Afghan currency to help meet
a threatened food shortage.^^ The Foreign Operations Adminis-
tration was to administer the program, and Afghan funds received
in payment were to be used for assistance in the economic develop-
ment of the country.

On May 4, the Export-Import Bank of Washington announced
authorization of a loan of $18,500,000 to Afghanistan to assist in
financing purchase of materials, equipment, and services in the
United States for the Helmand River Valley development project
and for reorganizing and training an Afghan road maintenance
unit."* The new loan was the second made by the bank to Af-
ghanistan in connection with the Helmand River project, which

was designed to benefit about one-fourth the area of Afghanistan
and about one-sixth of its 12,000,000 people. An earlier loan
(1949) of $21,000,000 was to assist in purchasing equipment and
services in the United States for the building of the Kajkai Dam,
the Arghandab Dam, and the Boghra Canal system by the Morri-
son Knudsen Afghanistan Co., Inc., which established primary
storage regulation of the two major rivers in the Helmand Valley.
The current stage of the development, involving an estimated cost
of $27,000,000, provides for a 3-year development program, includ-
ing hydroelectric installations, primary and lateral canals, and
drainage, and is correlated with the program for agricultural de-
velopment under the Afghan Helmand Valley Authority, with
technical assistance from the Foreign Operations Administration.

All told, it was estimated that these developments would result
progressively in an increase in Afghan agricultural productive ca-
pacity of more than 700,000 acres of new and improved land.

In Nepal the primary stress was placed on agricultural and com-
munity development, improved techniques and better seeds being
Nepal's principal agricultural needs.^^ Small irrigation projects
have been undertaken, with the construction of 10 deep irrigation
wells. Through the program for community development, train-
ing and demonstration in public health and sanitation have been
brought to many villages. Malaria control teams have eliminated
malaria, the greatest health problem, in a number of areas in Nepal
which are potentially productive but have not previously been
habitable.

On September 27, 1954, the Foreign Operations Administration
announced a relief program for Nepal, where floods and an earth-
quake had rendered more than 132,000 people homeless and left
1,000 dead.^" Dr. Alexander Langmuir, chief of the epidemic con-
■ trol programs of the U. S. Public Health Service, was sent to Nepal,
air reconnaissance of the affected area was authorized, and some
$75,000 was spent for the purchase of vaccines and antibiotics.

The United States has engaged in significant programs of both
technical and economic assistance in Pakistan. Since the program
began in early 1952, priority has been given to agricultural produc-
tion. Because of crop failures in 1951-1952 and the threat of famine
in 1953, the U. S. Congress provided in the spring of 1953 for the
shipment of some 700,000 tons (26 million bushels) of wheat to

52

Pakistan on a grant basis, with an additional 300,000 tons to be
made available on a grant, loan, or purchase basis, depending on
the situation. The arrival of the S.S. Rempang at Chittagong on
May 20, 1954, brought American wheat deliveries to 610,976 tons,
involving a total of 94 voyages and including 56 vessels under the
United States flag."'

The Pakistan Government announced on April 27 that since
the special program had achieved its purpose, no further wheat de-
liveries were needed under the program. A significant portion of
the wheat was distributed free to the most needy, the balance hav-
ing reached the market through the normal distribution channels.
From the sale of the wheat, the Pakistan Government expected to
realize I50 million in rupees to be earmarked for mutually agreed
projects necessary to the development of Pakistan, with stress on
projects to guard against the recurrence of famine.

Although primary stress in the American program in Pakistan
remained in the realm of food production, about two-thirds of the
funds for fiscal year 1954 being devoted to agriculture, serious atten-
tion was also given to industry. American technicians completed
a survey of railway signal practices and assisted in planning a diesel
engine school. Engineering assistance was provided for a large fer-
tilizer factory to be completed in 1956, while a road-building dem-
onstration and training project was established in East Pakistan.
Technical guidance was also provided in inventory, accounting,
handling of materials, and safety standards."*

On June 24 Director Stassen, of the Foreign Operations Admin-
istration, signed two comprehensive contracts with American col-
leges, linking Washington State College with the University of
Punjab (West Pakistan) and Texas Agricultural and Mechanical
College with the University of Dacca (East Pakistan). The col-
leges were to undertake a 3-year program in engineering, educa-
tion, agriculture, business administration, and home economics.
Under the contracts, involving some $3 million, the American in-
stitutions agreed to send university teams overseas to remain in
residence at the foreign institutions and to provide special con-
sultants for brief periods. These particular staffs were to total
some 40 college representatives. In turn, the foreign institutions
were to send key faculty members and graduate students to study
at their "sister institutions" in the United States.""

53

As a matter of additional emergency assistance, on August 14
President Eisenhower approved assistance to flood victims in
Pakistan, and the Secretary of State was directed to conclude the
necessary bilateral agreement with Pakistan to implement the as-
sistance."" Two United States Air Force transport planes left the
United States on August 13 for Dacca with a cargo of 55,000-60,000
pounds of medical supplies for victims in Pakistan, and 40 two-man
teams of Army Medical corpsmen from the Far East Command
were sent from bases in Japan, with supporting personnel and
equipment. In addition, the U.S. Public Health Service sent the
chief of its epidemic control programs, Dr. Langmuir, and a six-
man team of experts.

It was in the joint communique issued on October 21, at the con-
clusion of Prime Minister Mohammed All's visit in Washington,
that the United States announced its intention to make $105 mil-
lion available to Pakistan during the current fiscal year in economic
assistance, part of it in the form of loans, to include funds for tech-
nical assistance, flood relief, and development purposes — a substan-
tial amount in agricultural commodities.'"

When Ambassador George V. Allen appeared before the House
of Representatives Committee on Foreign Affairs on May 4, 1954,
particularly to support the proposal for continued technical and
economic assistance to India as recommended by President Eisen-
hower, he noted that there had been much discussion concerning
the Indian attitude toward the United States and some question-
ing as to the continuance of the program.'"^ Ambassador Allen
pointed out that Indian leaders desired American assistance and
that he believed past aid had been used effectively. Indians were
well aware of what the United States had been doing in their
country, he said. Mr. Allen continued :

Americans today are advising in the various Ministries in New Delhi and
throughout India. They have established personal relationships of a very
friendly character, and their work is being made more immediately effec-
tive because of the economic aid which is supporting their technical advice.
They are working with Indian experts and technicians in bringing to the
Indian people some realization of the people's hope and demand for eco-
nomic improvement. In my opinion, it is in the national interests of the
United States to continue our aid in a manner so that its effectiveness will
not be impaired.

54

Mr. Allen went on to point out that the Indian people and their
leaders believed in "a democratic form of government" and were
"trying to make economic progress through democratic institu-
tions," in "sharp contrast to autocratic, dictatorial. Communist
methods." It would be tragic, he thought, "if their present con-
fidence in democratic methods should fail and they thereby would
abandon hope for the future under a democratic form of govern-
ment." The Ambassador said:

I am keenly aware of the differences of opinion and policies between India
and ourselves. The foreign policies of the Government of India and of the
United States are frequently divergent. But we should keep in mind that
democracy and freedom of opinion go hand in hand and that freedom must
accept diversity of views. It is my belief that an independent India is a
source of strength to the free world.

Mr. Allen concluded that it was "wise to continue a substantial
program" and that the results of such action would be "beneficial
to both India and ourselves."

As already noted, funds programed during fiscal year 1954
included $60,500,000 in economic assistance and some $20,000,000
in technical assistance for India. During the first 6 months of
1954 several project agreements were signed and virtually all avail-
able funds were obligated. To support the Indian plan for in-
creasing irrigated land by 15,000,000 acres within 5 years, a project
to construct 2,650 deep irrigation wells was undertaken in 1952,
and by the spring of 1954 some 900 wells had been drilled. It was
estimated that, when it was completed, about 1,000,000 acres would
be added to the irrigated area, while other projects were to irrigate
5,000,000 additional acres and add about 4,000,000 tons to the an-
nual production of grain. Already more than 130,000 additional
acres have been brought under irrigation, and more than 60,000
acres reclaimed. Improved strains of cattle have also been intro-
duced, and more than 1,000,000 cattle inoculated and vaccinated.

Partly to counter increasing urban unemployment, India de-
voted more effort during 1954 to transportation, power, and in-
dustry. The United States undertook to supply 100 locomotives
and 5,000 freight cars to help put Indian railways in condition to
meet the issues of an expanding economy. Progress was also made
in the creation of a private industrial development corporation —
the Indian Credit and Investment Corporation — to which the In-

55

The three R's in India — children at one of thousands of new schools opened
under Indians Community Projects program, to which FOA gives major
assistance.

dian Government was to make available funds, derived from the
sale of steel furnished under the American program. Private in-
vestors, primarily Indian, vv'ere believed to be ready to invest about
$10 million, and the International Bank for Reconstruction and
Development planned to lend |io million. The corporation was
to provide financing and technical and managerial assistance to
promote the growth of private industry in India.

There were other features of the program, including the Indian
National Service Extension projects, which reached some 47 mil-
lion people in 71,000 villages by 1954, and in which American
technicians played a significant role."" Nearly 1,500 local schools
were started and 3,700 adult education centers opened, with 34
extension training centers in operation for the training of local
village workers. Moreover, the malaria control program was fur-
ther expanded to cover about 125 million Indians, while a village
and community sanitation program was scheduled to be carried
out within 2 years to improve drinking water sources and sanita-
tion conditions in 10,000 villages and 25 urban centers.

56

AFRICA

The major stress of the program of assistance in Ethiopia was
on the development of agricukure, essentially through training in
modern techniques, largely by the Oklahoma Agricultural and
Mechanical College, of Stillwater, Okla., under a 3-year contract
with the Foreign Operations Administration."" Ground was
broken early in 1954 for the building of the Imperial Ethiopian
College of Agriculture and Mechanical Arts, to be operated by
Oklahoma A and M College and directed by an American presi-
dent. A health clinic and training center were to be established
at Gondar. Moreover, some 58 new capital investments from
foreign sources, totaling about $130 million were either made or
under consideration as a result of the activities of the Foreign Op-
erations Administration mission in Ethiopia.

The program in Liberia was designed to teach Liberians how to
develop the resources of their country.'"^ Agricultural projects had
priority, and the primary accomplishment was the estabUshment
of a research center at Smakoko. Public health activities were
extended to the Bonni Hills area, a region being developed for iron
ore deposits. For a project in education, a contract was being
negotiated with Prairie View College, an associate of the Texas
Agricultural and Mechanical College.

The modest program in Libya concentrated on problems of agri-
culture, health, and education. Since some 90 percent of Libyan
school children appeared to be afflicted with trachoma, treatments
were continued in schools and clinics and attention was given to
teaching elementary sanitation in schools and teacher-training in-
stitutions. On the basis of soil and water resources data developed
by Americans, new areas have been opened for irrigation demon-
strations. Americans have also demonstrated more efficient meth-
ods of wool shearing, washing, and grading, and olive pruning.

On June 19, 1954, Henry S. Villard, the American Minister
to Libya, presented a check for |i million to Prime Minister Ben
Halim, in Tripoli, for economic development in Libya."" In an
exchange of letters on that day, Mr. Villard stressed the continuing
American interest in the development of Libyan economy. A few
days later, on June 25, it was announced that the United States
had approved a gift to Libya of 6,000 tons of wheat, in response

57

to an appeal for assistance in meeting grain shortages resulting
from continued droughts.

On September 9, at Benghazi, the United States signed a base
agreement with Libya as "an important contribution to the defense
of the free world" and in a separate exchange of notes undertook
to assist Libya with its economic development program.'"' The

The United Nations at work at Ethiopia. Here an FAO expert demonstrates
a modern scythe to Ethiopian farmers.

base rights agreement provided for long-term operation of the
Wheelus Air Force base near Tripoli. It went into force on Octo-
ber 30, following ratification by the Libyan Parliament and King.
Under the economic aid agreement the United States undertook to
provide in the current fiscal year $7 million in development as-
sistance and 24,000 tons of grain for relief in drought areas. Sub-
ject to congressional appropriations, the United States will in the
next 6 years provide Libya $4 million annually for economic de-
velopment and thereafter for the next 11 years |i million annually.

58

The two countries have also agreed to raise their respective lega-
tions to the rank of embassies.

Acting Secretary of State Walter Bedell Smith characterized
these agreements as ones which would "strengthen the ties of amity
which bind together the people of the two countries." General.
Smith noted both American support of the United Nations pro-
posal leading up to Libyan independence in 1951 and of subsequent
membership in the United Nations and its contributions in tech-
nical and economic assistance to enable Libya to rest on firm eco-
nomic foundations. The United States, he said, would continue
its "sympathetic interest" in Libya's economic progress and would
cooperate with the Libyan Government in considering measures
required toward this end.

Export-Import Bank Loans

Even before the inauguration of the programs for technical and
economic assistance, the Export-Import Bank of Washington had
authorized a number of loans in the Near East, South Asia, and
Africa for the economic development of countries in that general
area. By July 1954, these loans were substantially as indicated in
the table on page 71.

U. S. Support for U. N. Programs
of Assistance

The United States, of course, continued to support the various
U.N. programs of technical assistance during 1954. On May 11,
Ambassador Lodge gave a check for $1,645,812 to the United
Nations Expanded Technical Assistance Program to complete the
U.S. contribution for 1953."'* In a statement on that occasion Mr.
Lodge noted that the President's Commission on Foreign Eco-
nomic Policy, the Randall Commission, had urged strengthening
and expansion of United Nations technical assistance. He also
mentioned the significance of the program in the long-range
strengthening of the free world in such countries as Pakistan,

59

Afghanistan, and Libya in projects in land reclamation, irrigation,
and hydroelectric development.

While the United States was unable to announce its precise con-
tribution to the United Nations program for 1955, Ambassador
. Lodge advised Dr. V. A. Hamdani, Chairman of the Negotiating
Committee, Extra-Budgetary Funds, on November i ^'^ that the
President was prepared to request from the Congress funds for an
American contribution to the program for 1955. He added :

Since the inception of the United Nations Expanded Program of Tech-
nical Assistance, the United States has given it strong support. For the first
three years of the program the United States contributed a total of $36,000,-
000, or approximately 60 percent of all funds pledged, to the central fund.
For 1954 the dollar amount of our pledge increased to $13,861,809, although
our percentage share of the central fund was reduced to approximately 57
per cent. The full amount of the U.S. pledge for calendar year 1954 has
been appropriated by the U.S. Congress and is available for contribution to
the program.

The United States recognizes the importance of technical assistance in
promoting the economic development of the underdeveloped countries and
has been providing technical assistance bilaterally as well as supporting the
UN technical assistance program. It has also contributed generously to the
other special UN programs which are aimed directly or indirectly at eco-
nomic development or at alleviation of economic distress.^^"

The United States has also contributed generously to other
United Nations agencies which have rendered basic assistance to
underdeveloped areas, such as the Food and Agriculture Organiza-
tion (Fao), the World Health Organization (Who), the United
Nations Educational, Scientific and Cultural Organization
(Unesco), and the Children's Fund (Unicef). Almost nine-
tenths of the assistance given by Unicef to underdeveloped coun-
tries since 1950 has been allocated to Africa, Asia, the Eastern Medi-
terranean region, and Latin America. During 1954 it was pro-
posed to give 44 percent of Unicef aid to Asia, 15 percent to Africa,
and about 14 percent to the Eastern Mediterranean area. On Jan-
uary 13, 1955, Ambassador Lodge presented a check for $7,773,550
as a partial contribution to Unicef's 1954 program, with an indi-
cation that further payments would be dependent upon matching
contributions from other governments."^

While the United States was also interested in the projects for an
international finance corporation and the special United Nations

60

fund for economic development,"^ it was a heavy contributor to the
capital of the International Bank for Reconstruction and Develop-
ment, which has assisted in financing a large number of develop-
ment projects. By June 30, 1954, out of an authorized capital of
$10,000,000,000, the subscribed capital had reached $9,148,500,000.
The United States had subscribed $635,000,000 with 31,750 shares in
the amount of $3,175,000,000. The total of effective loans outstand-
ing held by the bank amounted to $1,663,000,000. Among loans in
the Near East, South Asia, and Africa were those listed in the
accompanying table.

That the United States continued to look upon the problems of
stability and security in the Near East, South Asia, and Africa from
a broad point of view was indicated by a number of developments
toward the close of 1954. In a news conference on December 7,
Secretary Dulles indicated that while "a very high emphasis upon
the military" was necessary until there was "greater confidence in
the world," the present phase of the struggle "between the world
of Communist despotism and the free nations" had "shifted to

A portable public health clinic in Liberia, where an FOA doctor and nurse
call regularly.

some extent, for the time being perhaps, more to economic com-
petition" and that there was less fear than there had been of "open
military activities." More thought, therefore, was needed on "this
phase of the problem" than had been the case "when the primary
emphasis was placed upon the military."

Secretary Dulles declared on December 21 that, "in the Middle
East, the northern tier concept" was "taking form under the leader-
ship of Turkey and Pakistan."

In his State of the Union Message to the Congress on January 6,
1955, President Eisenhower noted a number of positive develop-
ments in the Middle East and the Eastern Mediterranean:

Recent agreements between Turkey and Pakistan have laid a foundation
for increased strength in the Middle East. With our understanding sup-
port, Egypt and Britain, Yugoslavia and Italy, Britain and Iran have resolved
dangerous differences. The security of the Mediterranean has been en-
hanced by an alliance among Greece, Turkey, and Yugoslavia.

But the President added that the "military threat" was "but one
menace to our freedom and security" and that the free nations
"must maintain and reinforce their cohesion, their internal security,
their political and economic vitality, and their faith in freedom."

The President's Budget Message of January 17, which called for
an expenditure of some $4,300,000,000 on mutual assistance pro-
grams, gave appropriate stress to military assistance but pointed
out that the national interest required "direct assistance to certain
less developed countries where a rate of economic progress which
would be impossible without such assistance is essential to their be-
coming and remaining strong and healthy members of the com-
munity of free nations capable of resisting Communist penetration
and subversion."

62

FOOTNOTES AND TABLES

^ For background, see Harry N. Howard, "The Development of United
States Policy in the Near East, 1945-195 1," Bulletin of Nov. 19, 195 1,
p. 809, and Nov. 26, 1951, p. 839 (also available as Department of State
publication 4446); "The Development of United States Policy in the Near
East, South Asia, and Africa, 1951-1952," ibid., Dec. 8, 1952, p. 891, and
Dec. 15, 1952, p. 936 (also available as Department of State publication
4851); and "The Development of United States Policy in the Near East,
South Asia, and Africa During 1953," ibid., Feb. 22, 1954, p. 274, Mar. i,
1954, p. 328, and Mar. 8, 1954, p. 365.

^ U.N. doc. A/2663, Annual Report of the Secretary-General on the Wor^
of the Organization, 1 July 1953-30 June 1954 (1954), p. xiii.

^ For a letter from Secretary Dulles to Mr. Hoover and a message from
the Secretary to Ambassador Henderson, see Bulletin of Aug. 16, 1954, p.
232. In a statement in the House of Commons on .Nov. 2, 1954, Foreign
Secretary Anthony Eden declared that a settlement could not have been
reached without American help, particularly U.S. financial assistance to
the Iranian Government after August 1953. For text, see British Informa-
tion Services, Official Text, T. 45.

^ Bulletin, Aug. 16, 1954, p. 232. There were to be eight companies in
the Consortium: the Gulf Oil Corporation, Socony Vacuum Oil Company,
Standard Oil Company of New Jersey, Standard Oil Company of California,
the Texas Company, the Anglo-Iranian Oil Company, Compagnie Fran^aise
de Petroles, and the Royal Dutch /Shell Company.

^ Ibid., p. 232. See also the statement of Howard Page, Standard Oil Com-
pany of New Jersey, who served as chairman of the International Consortium.
On the current oil situation in the Middle East and Iran, in particular, see
U.N. doc. E/2581, ST/ECA/25, Summary of Recent Economic Develop-
ments in the Middle East, ig^2-^y. Supplement to World Economic Report
(1954), chapter 2. Iran produced 32,259,000 metric tons of oil in 1950; its
reserves were estimated in 1953 at 1,722,300,000 metric tons.
Bulletin of Aug. 23, 1954, pp. 266-267.

' The Anglo-Iranian Oil Company announced on Oct. 29 that it was to
receive more than |6oo million from the seven other oil companies in the
Consortium which was to exploit the oil wealth of Iran.

'* Ibid., Nov. 8, 1954, p. 683. See also ibid., Dec. 27, 1954, p. 985, for the
Department's announcement of Dec. 7 concerning arrangements for produc-
tion and sale of Iranian oil.

^ Ibid., Aug. 9, 1954, p. 198.

^"Ibid., Aug. 16, 1954, p. 234.

" Ibid., Nov. 15, 1954, p. 734.

Ibid. It is a matter, perhaps, of some historic interest in this connection
that the original Suez Canal Concession was granted to Ferdinand de
Lesseps by the Khedive Mohammed Said on Nov. 30, 1854 — almost precisely
a century before an Egyptian Government came into control of the base.

63

" For a brief review see "Cyprus: New Issue, Old Land," United Nations
Review, vol. I (Dec. 1954), pp. 44-51.

"For the Kyrou statement of Sept. 21, 1953, see U.N. doc. A/PV.439,
PP- 65-71, especially paragraph 18. See also the remarks of Ambassador
Athanase G. Politis, Nov. 11, 1952, in U.N. doc. A/PV.393, pp. 211-14, and
those of Dimitrios Lambros in Committee III on Nov. 24, 1952, and the reply
of Adil Derinsu (Turkey) in U.N. doc. A/C.3/SR.454, pp. 220-21, 223.

'° The request was filed under rule 14 of the Rules of Procedure, and the
item entitied: "Application, under the auspices of the United Nations, of the
principle of equal rights and self-determination of peoples in the case of the
population of the Island of Cyprus."

" For the Greek position see Press and Information Department, Prime
Minister's Office, Documents and Press Comments on the Cyprus Question
(Athens, 1954), 157 pp. Prime Minister Alexander Papagos' letter, dated
Aug. 16, 1954, is on pp. 150-57.

" British Information Services, No. 408/3, Aug. 19, 1954; No. 408/4,
Aug. 27, 1954.

The Turkish Government adopted a position almost identical with that
of the United Kingdom as to domestic jurisdiction under article 2 (7) of the
charter and noted the presence of a sizable Turkish-speaking minority on
the Island.

U.N. docs. A/BUR/SR.93; A/2703.
™ Burma, China, Cuba, Czechoslovakia, Ecuador, Iceland, Syria, Thai-
land, and the Soviet Union voted in favor; Australia, France, and the United
Kingdom opposed. The United States, which made no comment during
the discussion, abstained with Colombia and the President.
21 U.N. doc. A/PV.477.

The vote was as follows: In favor (30); Afghanistan, Burma, Byelo-
russia, China, Costa Rica, Cuba, Czechoslovakia, Ecuador, Egypt, El Salva-
dor, Greece, Guatemala, Haiti, Honduras, Iceland, Indonesia, Israel, Leb-
anon, Mexico, Nicaragua, Philippines, Poland, Saudi Arabia, Syria, Thailand,
Ukraine, U.S.S.R., Uruguay, Yemen, Yugoslavia; against (19): Australia,
Belgium, Canada, Chile, Colombia, Denmark, Dominican Republic, France,
Liberia, Luxembourg, Netherlands, New Zealand, Norway, Paraguay, Peru,
Sweden, Turkey, Union of South Africa, United Kingdom; abstentions (11):
Argentina, Bolivia, Brazil, Ethiopia, India, Iran, Iraq, Pakistan, Panama,
United States, Venezuela.

U.N. doc. A/PV.484, pp. 137-39.
^•■Bulletin of Jan. 3, 1954, p. 31-

U.N. doc. A/C.1/SR.750; verbatim text supplied by the Greek delega-
tion.

™ U.N. doc. A/C.i/SR.75o; verbatim text supplied by the Turkish delega-
tion.

"U.N. docs. A/C.1./SR.751; A/C.i/L.126, 127; A/C.i/764.
^*See U.N. docs. A/2881; A/PV.514. Priority was given to the New
Zealand proposal by a vote of 28 to 15, with 16 abstentions. The abstentions

64

on the final vote were: Australia, Byelorussia, Chile, Czechoslovakia,
Poland, Ukraine, Union of South Africa and U.S.S.R.

It was interesting to observe that, despite their differences on the matter,
the United States, the United Kingdom, Turkey, and Greece supported the
resolution, while the Soviet bloc, among others, abstained. Equally inter-
esting was the fact that, while the United Kingdom representative, Mr. Nut-
ting, considered the vote a victory for "common sense" and repeated his view
that, legal considerations aside, a full-dress debate could have done serious
damage to relations among nations of the free world, Ambassador Kyrou
believed an airing of the problem "a most welcome development" and indi-
cated that, if the "renewed confidence" failed to elicit a response from the
United Kingdom, the problem would come again before the United Nations.

^^U.N. doc. A/2663, Annual Report of the Secretary-General on the
Worl^ of the Organization, 1 July 1953-30 June 1954, p. xii.

Bulletin of Apr. 26, 1954, p. 628.
^^Ibid., May 10, 1954, p. 708.

Ibid., June 15, 1953, p. 834, n. 2.

Ibid., May 17, 1954, p. 761.

l^'^: July 5. 1954. P- 3-
Ibid., Nov. 8, 1954, p. 675.

For background on the Qibya incident, see ibid.. Mar. i, 1954, p. 329.
" United Nations, Security Council, Official Records, Ninth Year, Sup-
plement (January, February, and March 1954), pp. 9-22.
Ibid., pp. 23-40.

For reports of the Truce Supervision Organization on the Nahhalin and
Scorpian Pass incidents, see U.N. docs. 8/3251, 3252.

*''For the discussions of Apr. 8, 12, 27, and May 4, see U.N. docs. S/PV.
665-670. On Apr. 20 the Jordan Parliament publicly thanked Andrei
Vyshinsky, the Soviet representative, for his efforts in the Security Council in
supporting the Arab position. Ambassador Eban stated on May 4 that Israel
casualties between June 1949 and Mar. 23, 1954, had reached 518, of whom
300 had been wounded and 218 killed. The Truce Supervision Organiza-
tion was able to verify that 37 Israelis were killed and 32 wounded between
June 1949 and May 20, 1954, while some loi Jordanians were killed and 76
wounded, with Israel held responsible for 80 violations of the armistice agree-
ment and Jordan 60. Between May 9 and Dec. 6, 1954, it appears that
Israel was held responsible for 18 violations and Jordan 3, and that 29 Jor-
danians were killed and 18 wounded, while 6 Israelis were killed, according
to the verified estimates of the Truce Supervision Organization. There
were, of course, other casualties in incidents for which responsibility was not
determined. While the major problem has always been along the Israel-
Jordan demarcation lines, it may be observed that the Truce Supervision
Organization condemned Israel 9 times and Egypt 20 times for violations
of the Israel-Egyptian Armistice Agreement between April and December
1954, and condemned both Israel and Syria for a violation of the Israel-
Syria Armistice Agreement. See U.N. doc. S/3319 for incidents in Gaza

65

Strip, Sept.-Oct. 1954, in which Israel was condemned three times and Egypt
seven times for armistice violations.

" Bulletin of July 12, 1954, p. 48. The Truce Organization was unable
to fix responsibility for the outbreak in Jerusalem. See U.N. docs. S/3258,
3259, 3260, 3264, 3269/Corr. I, 3275, and 3278.

" U.N. doc. S/3290, p. 6.

*^ U.N. doc. S/3168. In turn the Egyptian Government complained on
Feb. 3 of an incident at Al' Auja on Oct. 3, 1953 (S/3172, 3174, 3179). For
a general review, see A/2663, Report of Secretary-General ( 1954), pp. 25-26.

"U.N. docs. S/PV. 657-664; S/3188/Corr. I. The Soviet Union had
also vetoed a resolution dealing with Israel actions in the Syrian-Israel demili-
tarized zone.

"U.N. docs. S/PV. 682-686; S/3296, 3297 and Corr. 1/3298, 3300, 3302,
3309. 3310. 331 1. 3315. 3319. 3323. 3325. 3326. It may also be noted that
the Syrian Government complained against an Israel action in forcing a
Syrian passenger plane, flying over its regular route, to land at Lydda, Israel,
on Dec. 12, 1954 (U.N. doc. S/3330). The plane was released on Dec. 13.

" Bulletin of Jan. 17, 1955, p. no.

Ibid., Nov. 22, 1954, p. 776. A similar protest was filed with the Gov-
ernment of the United Kingdom before the presentation of the credentials
of the British Ambassador on Nov. 10. The Soviet Ambassador had pre-
sented his credentials at Jerusalem on June 16, 1954.

*^ For the text of an address by Ambassador Lawson before the Israel-
America Friendship League at Tel Aviv on Dec. 4, see ibid., Jan. 17, 1955,
p. 92.

See, for example, the remarks of Dr. Mohammed Fadhil al-Jamali
(Iraq), Sept. 27, 1954 (U.N. doc. A/PV. 479); Ahmed Shukairi (Syria),
Oct. 5, 1954 (U.N. doc. A/PV. ■189); Dr. Mahmoud Azmi (Egypt), Oct. 6,
1954 (U.N. doc. A/PV. 492,)
^0 U.N. doc. A/PV. 492.

" For texts of U.S. statements and of resolution, see Bulletin of Jan. 3,
1955, p. 24. See also U.N. doc. A/2717, Annital Report of the Director of
the United Nations Relief and Worlds Agency for Palestine Refugees in the
Near East Covering the period i July /95_j to jo June 1954; A/2826 and
Corr. i; and A/2816.

Bulletin of Nov. 29, 1954, p. 804.
Ibid., Jan. 3, 1955, p. 30.
^* Ibid., p. 31.

See the President's letter of transmittal to The Report to Congress on
the Mutual Security Program for the Six Months Ended December j/, /95J,
Bulletin of Mar. 29, 1954, p. 484.

H. Doc. 449, 83d Cong., 2d Sess.; Bulletin of July 5, 1954, p. 35.
" See also The Mutual Security Act of 19^4: Report of the Committee on
Foreign Relations on H. R. g6yo. 83d Cong., 2d Sess., S. Rept. 1799. United
States Aid to India: Report of the Investigations Division of Senate Appro-
priations Committee, April 1954. 83d Cong., 2d Sess.

66

°* Public Law 665, 83d Cong., 2d Sess., chapter 937. Including both new
and carryover funds the total was approximately $5,200,000,000.

™ Department of Commerce, Foreign Grants and Credits by the United
States Government, September 1954 quarter, appendix, table 2. Although
these figures are not complete, this summary gives a generally accurate pic-
ture of an everchanging situation.

Report to Congress on the Mutual Security Program jar the Six Months
Ended June jo, 1^54, p. 21.

Bulletin of June 15, 1953, p. 831. It will be recalled that Secretary
Dulles indicated that the United States, while awaiting the formal creation
of a "security association," could "usefully help strengthen the interrelated
defense of those countries which want strength, not as against each other or
the West, but to resist the common threat to all free peoples."

On Jan. 13, 1955, Iraq and Turkey announced their intention of signing
a mutual defense agreement. They signed on Feb. 24.

^ Ibid., Feb. 15, 1954, p. 247. President Bayar was awarded the Legion
of Merit at a state dinner at the White House on Jan. 27.
^*Ibid., Mar. i, 1954, p. 327.

Ibid., Mar. 15, 1954, p. 401. See also John D. Jernegan, "America and
the New India," ibid., Apr. 19, 1954, p. 593.

Ibid., p. 400.

Embassy of Pakistan, Washington, D. C, press release 25, Apr. 2, 1954.
Bulletin of May 17, 1954, p. 772.

For text of agreement, see press release 262-A dated May 19.
'"For text of joint communique of June 5, see Bulletin of June 14, 1954,
p. 912.

Ibid., June 28, 1954, p. 992.

" Ibid., Sept. 20, 1954, p. 393. See also the address of Ambassador Horace
A. Hildreth, on Sept. 23 at the Fletcher School of Law and Diplomacy, Med-
ford, Mass., ibid., Oct. 4, 1954, p. 492.

"For text of joint communique of Oct. 21, see ibid., Nov. i, 1954, p. 639.

'*For text see News From Turl^ey, vol. VII, No. 22, Aug. 12, 1954.
Cf. especially with article 5 of the North Adantic Treaty, in A Decade
of American Foreign Policy: Basic Documents, 1941-4^, S. Doc. 128, 8ist
Cong., I St Sess., p. 1329.

General Assembly Resolution 378 (V). This resolution, of Yugoslav
origin, as modified and supported by the United States and other members
of the United Nations, provided that, if a state became engaged in armed
conflict, it take all steps compatible with the right of self-defense to end the
conflict at the earliest possible moment, publicly announce its readiness to
discontinue military operations and so notify the United Nations, and invite
the latter to dispatch the Peace Observation Commission to the area of the
conflict.

" With signature of the treaty, a memorandum on the Balkan Consultative
Assembly, to be composed of an equal number of representatives from each
of the parties, was also announced.
Bulletin of Oct. 18, 1954, p. 555.

67

''^Ibid., June 7, 1954, p. 871. See also Arthur C. Ringland, "The Organi-
zation of Voluntary Foreign Aid: 1939-1953," ibid.. Mar. 15, 1954, p. 383.

Educational exchanges under the Fulbright Act in 1953 had involved
no less than 702 people, including 233 students from the Near East, South
Asia, and Africa in the United States.

*° Report to Congress on the Mutual Security Program for the Six Months
Ended June ^o, 1954, p. 23.

Ibid., pp. 23-24; Bulletin of June 14, 1954, p. 912, and June 28, 1954,
p. 992.

Report to Congress on the Mutual Security Program for the Six Months
Ended June jo, 1954, pp. 24-25.

Bulletin of Nov. 22, 1954, p. 776.

Report to Congress on the Mutual Security Program for the Six Months
Ended June ^o, 1954, pp. 25-26; Bulletin of Mar. 22, 1954, p. 442, and May
10, 1954, p. 713. The instruments of ratification of the treaty of friendship,
commerce, and navigation between the United States and Israel, signed on
Aug. 23, 1 95 1, were exchanged on Mar. 4, 1954, and the treaty entered into
force on Apr. 3, 1954.

Bulletin of June 21, 1954, p. 962.

Report to Congress on the Mutual Security Program for the Six Months
Ended June jo, 1954, p. 28.

" Bulletin of June 28, 1954, p. 1000.

^ Ibid., July 12, 1954, p. 57. General distribution was as follows: irriga-
tion, I3 million; range resources rehabilitation and development, $2 million;
afforestation and watershed protection, $500,000; road construction, $2 mil-
lion; and ground water exploration and development, $500,000.

Ibid, Aug. 16, 1954, p. 233. The Improvement Service (Earis) is jointly
staffed and controlled, with a working capital of $25 million. The United
States contributes $10 million and the Egyptian Government the equivalent
of $15 million.

°" Report to Congress on the Mutual Security Program for the Six Months
Ended June jo, 195^, p. 28.

Bulletin of June 14, 1954, p. 913.
Ibid., July 26, 1954, p. 132.
Ibid., Apr. 12, 1954, p. 566.

Ibid., May 31, 1954, p. 836. The loan agreement, signed by Gen. Glen
E. Edgerton, Managing Director of the bank, and Ambassador Mohammad
Kabir Ludin, on May 14, provided for repayment in 36 semiannual install-
ments beginning on Oct. 20, 1958, at 4'/2 percent interest.

Report to Congress on the Mutual Security Program for the Six Months
Ended June jo, 1954, pp. 31-32.

Bulletin of Oct. 25, 1954, p. 615.
°' For a detailed account, see Foreign Operations Administration, Sum-
mary: Report of the Pakistan Wheat Program of i<)^^-ig^4, July 7, 1954.
See also Bulletin of May 17, 1954, p. 760. As a token of gratitude for
American assistance, Pakistan offered on May 5, 1954, to supply the labor

68

involved in the construction of a U. S. Embassy chancery at Karachi. The
offer was accepted.

Report to Congress on the Mutual Security Program for the Six Months
Ended June 30, ig54, p. 31. On June 2, the International Bank for Recon-
struction and Development, with six private British banks participating, ad-
vanaced a loan of £5,000,000 ($14,000,000) for the construction of a natural-
gas transmission line in West Pakistan, based on the discovery of natural gas
some 350 miles north of Karachi (Bulletin of June 28, 1954, p. 991)- The
loan was made to the Sui Gas Transmission Co., Ltd. Of its annual re-
quirements of about 1,200,000 tons of coal, Pakistan has been importing
600,000 tons in addition to some 500,000 tons of fuel oil. It is estimated that
the gas in the first year of operations will replace about 500,000 tons of coal.

"** Bulletin of July 12, 1954, p. 56. For an account of these programs
and of others being conducted by colleges and universities, see the pamphlet
American Universities in Technical Cooperation, published by the Office of
Public Reports, Foreign Operations Administration, Washington 25, D. C.

i"" Bulletin of Aug. 30, 1954, p. 295. It was indicated that more than 7
million people had been affected by the overflow of the Brahmaputra River.
The summer rice crop was partly destroyed, and a sizable portion of the
jute crop wiped out, while many homes were washed away.

^"^Ibid., Nov. I, 1954, p. 639. For an announcement of an agreement
covering part of the I105 million economic aid program, see ibid., Jan. 24,
1955, p. 157. For text of agreement, see ibid., Feb. 21, 1955, p. 308.

^"^ Ibid., May 17, 1954, p. 759. See also Ambassador Allen's address over
the Columbia Broadcasting System on May 16, ibid., June 7, 1954, p. 864, on
"The Growth of Freedom in India," in which he contrasted the attempts to
solve India's social and economic problems with those of Communist China.
Mr. Allen described India's 5-Year Plan of economic development as a "well-
thought-out, mature program" which was tackling India's most pressing
economic difficulty — her shortages in food-grains — "while at the same time
laying the foundations for the widespread industrial growth which must
evolve if India is to make real progress."

^"^ Report to Congress on the Mutual Security Program for the Six Months
Ended June 30, 1954, p. 30.
Ibid., pp. 32-33.
p. 33.

Bulletin of July 5, 1954, p. 15. The economic position of Libya was
also among the topics discussed during the visit of Prime Minister Ben
Halim to the United States in July.

Ibid., Sept. 20, 1954, p. 396.
^'^Ibid., May 31, 1954, p. 849.

Ibid., Dec. 6, 1954, p. 879.
"» See also the statements of Sen. H. Alexander Smith, U.S. Representa-
tive, at the Fifth U.N. Technical Assistance Conference, Nov. 26, 1954, ibid.,
Dec. 13, 1954, p. 926; and James P. Nash, U.S. Representative, in Com-
mittee II of the General Assembly, Nov. 19, 1954, ibid., Dec. 27, 1954, p.

69

1004. Fifty-six countries had pledged some $12,264,136 to the 1955 program
by Nov. 24, 1954.

See also Food and Agriculture Organization of the United Nations,
The State of Agriculture 1953, part II, Longer Term Prospects (January
1954); David McK. Key, "World Security and the World Health Organiza-
tion," Bulletin of Oct. 25, 1954, p. 616; "Health Progress in the Eastern
Mediterranean," Chronicle of the World Health Organization, vol. 8 (June
i954)> P- 185; U.N. doc. A/2686, Report of the Economic and Social Council,
6 August to 6 August ig54, pp. 72-78; Rajkumari Amrit Kaur, "Real
Hope for the Tens of Millions," United Nations Review, vol. I (December
1954).

pp. 8-1 1 ; "Advances in Education in Liberia," ii?id., pp. 16-19;
"Shared Skills in Libya," ibid., vol. I (July 1954), pp. 62-69; "A Year of
Progress in Technical Assistance," ibid., pp. 59-61; "Routing the Insect
Armies in the Jordan Valley," ibid., vol. I (November 1954), pp. 34-38.
For an excellent summary of the work of Unicef, see Unicef Compendium,
vol. V, 1954-1956 (United Nations Children's Fund, 1954).

See especially U.N. docs. A/2728, Economic Development of Under-
Developed Countries. Special United Nations Fund for Economic Develop-
ment; A/C.2/183, A/C.2/L.23o,233.

Bulletin of Dec. 20, 1954, p. 967. See also ibid., Dec. 27, 1954, p. 987,
for the appointment of Joseph M. Dodge as chairman of the Council on For-
eign Economic Policy, and ibid., Jan. 3, 1955, p. 16, for a statement on the
Third Colombo Plan Report and the U.S. contribution of $280 million in
grant assistance and about $62 million in loans authorized or disbursed
under the plan.

Ibid., Jan. 10, 1955, p. 43.
Jan. 17, 1955, p. 79.

Ibid., Jan. 31, 1955, p. 163. The President noted that the United States
had provided some grant and loan assistance in the Middle East and Africa
"to promote economic development and political stability" and that he would
request funds to continue this type of assistance in the fiscal year 1956.
This assistance had gone to Iran, Israel, Lebanon, Jordan, Egypt, and Libya,
and some had been extended to India. Similarly, the program of technical
assistance would be supported, he said, some 68 agreements having been
signed with states in Latin America, Asia, the Near East, and Africa.

(^o^r. pv.v.r «i-iu-c ^^4 (t^

Export-Import Bank Loans in the Near East, South Asia, and Africa, 1945-1954*

Country Date Authorized credit Purpose

Greece 1/9/46 $25, 000, 000 U. S. products and services. Some $10,436,000 canceled or

expired, about $13,250,000 outstanding.

Turkey 12/18/46- 28, 462, 230 14 loans for various types of industrial, electrical railway,

11/25/53 port, and shipping equipment. Some $292,000 canceled or

expired, $6,403,000 outstanding.

Israel 1/19/49- 135,000,000 Loans for agricultural equipment, transportation, housing,

10/26/49 telecommunications, port and industrial equipment.

$122,636,000 outstanding.

Egypt 7/16/47 7, 250, 000 Equipment for fertilizer and chemical industries. $5,800,000

outstanding.

Saudi Arabia 1/3/46- 40,000,000 Products and services, cement plant construction, materials

7/20/50 and equipment. Some $25,000,000 canceled or expired,

$8,767,000 outstanding.

Afghanistan 11/23/49 21,000,000 Canal and dam construction. $19,900,000 outstanding.

4/29/54 18, 500, 000 Helmand River Valley development.
Ethiopia 6/10/46- 3, 000, 000 Aircraft and spare parts, communications equipment, and

6/22/50 industrial machinery. About $230,573 outstanding.

Liberia 4/27/49 10, 350, 000 Iron ore production, highway improvement and construction,

water supply, and sewage system. $2,000,000 outstanding.

Total $288,562,230

*See Export-Import Bank of Washington, Eighteenth Semiannual Report to Congress for the Period January-June 1954,
appendix C. It may be noted that the loans in Africa as a whole totaled $152,852,331 and in Asia $588,827,320.
It was announced on Nov. 2 that the Export-Import Bank was ready to lend Iran $85,000,000. A loan of $25,000,000
to Iran, authorized on Oct. 6, 1950, had been canceled.

Loans of the International Bank for ^reconstruction and Development*

Country

Date

Orisinal amount

7/9/54

$19, 110, 000

9/13/50

5, 000, 000

9/13/50

2, 000, 000

2/19/51

1, 500, 000

India

8/18/49

34, 000, 000

9/29/49

10, 000, 000

4/18/50

18, 500, 000

1/23/53

19, 500, 000

India (Guarantor) . . .

12/18/52

31, 500, 000

India (Guarantor) . . .

11/19/54

16, 200, 000

6/15/50

12, 800, 000

Pakistan

3/27/52

27, 200, 000

Pakistan (Guarantor)

6/2/54

14, 000, 000

Turkey

in/50

13, 900, 000

7/7/50

12, 500, 000

2/26/54

3, 800, 000

6/18/52

25, 200, 000

Turkey (Guarantor) . .

10/19/50

9,000,000

9/10/53

9,000,000

Total

$284, 710, 000

Purpose

Electrical power developnient

Highway rehabilitation

Foreign exchange for development bank

Telephone and telegraph systems

Railway rehabilitation

Agricultural development

Electric power development

Electric power, flood control, and irrigation

Iron and steel production facilities

Electrical power development

Construction of flood control project

Railway rehabilitation

Construction of natural gas transmission line by Sui Gas

Transmission Company
Grain storage facilities
Port construction and development
Port construction and development
Electric power, irrigation, and flood control
Foreign exchange for private industry
Through Industrial Development Bank of Turkey

♦International Bank for Reconstruction and Development, Ninth Annual Report 1953-1954, appendix F.