Senator Kenneth Keating, New York Republican took the Senate floor today to call attention to the “principles so flagrantly and arbitrarily flaunted by Colonel Nasser in his use of the Suez Canal as a weapon of revenge against the State of Israel.”
“The recent acts of the Nasser regime in implementing its anti-Israel policy represent outright theft of ships’ cargo, in keeping with the planned design of stifling by all means the growth and prosperity of Israel, “the Senator said.
At the same time the House Sub-committee of Banking made public today recent testimony by Under Secretary of State C. Douglas Dillon Justifying the World Bark’s loan for the improvement of the Suez Canal. Mr. Dillon told the sub-committee that there were provisions in the Treaty of Constantinople “giving Egypt the right, in state of war, to take any security precautions, including stopping shipping of a country which may be specifically at war with Egypt.”
The Under Secretary appeared before the sub-committee to discuss the International Development Association Act. His testimony led to detailed questioning by committee members who took exception to United States support of the Suez loan by the World Bank and the failure of both the United States and the bank to effectively insist on Israel’s shipping rights.
“We must realize that there were, and there are in the world, alternative source, financing” available to Egypt “which we would not be particularly happy to see used,” Mr. Dillon said. He added that “certainly the holding up of this loan last winter would have, in our opinion, had any effect whatsoever in forcing the United Arab Republic to settle the problem of transit through the canal.”
Rep. Abraham J. Multer, New York Democrat, told Mr. Dillon that it was neither sound economic nor banking principle to suggest that the World Bank made the Suez Canal “because if it didn’t, Communist Russia might have made the loan.”
“The fact is,” Rep. Multer pointed out, “that during all of these last few years, at this very moment, communist war materiel, armaments, tanks, Jet planes, and training officers, have been in the UAR, and are at this very moment, and communist trained armies are lined up.. .alongside Israel, so we haven’t kept the Russians out of there at all. All we have done is given money to the UAR, thus releasing their other funds for war-like efforts.”
U.S. DIFFERS WITH NASSER ON SUEZ ISSUE, STATE DEPT. OFFICIAL SAYS
Rep. Seymour Halpern, New York Republican, termed the loan “a condoning of the flagrant violation of international law and morality by the United Arab Republic.” Rep. Halpern told Mr. Dillon that responsible bankers refuse loans “to men of ill repot who are responsible for tense situations that could explode with violence, or to men we use gangster like tactics, or who are violating law.”
Mr. Dillon pointed out that Egypt settled with the former owners of the canal before the loan was made. United Nations Secretary-General Dag Hammarskjold is seeking Suez solution, said Mr. Dillon, but it is “a complex legal problem based on definitions of the Armistice Agreement in that area.” He added that Mr. Hammarskjold “is still trying to work out an effective method of allowing cargoes from the State of Israel to pass-through the Suez Canal.”
America supported the Suez loan in the World Bank but “this did not mean support of the UAR’s position on shipping,” Mr. Dillon stated. He indicated that it was not a “clear-cut case” of Egypt violating transit obligations but a “very complex” issue and “a political matter.” He added that President Black of the bank “is intending to visit Israel in the next month or two, and there seems to be very fine relations between the State of Israel and the World Bank.”
According to Mr. Dillon, it would not have been “a very effective use of pressure” had the loan to Egypt for Suez improvement been withheld to force agreement on passage of Israeli ships and cargoes. He said: “The widening and deepening of the canal is of great interest to all maritime nations, of which the United States and the nations of Western Europe are an important part, and therefore carrying out this economic and useful project was important.”
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The Archive of the Jewish Telegraphic Agency includes articles published from 1923 to 2008. Archive stories reflect the journalistic standards and practices of the time they were published.
