Foreign Relations of the United States, 1955–1957, Arab-Israeli Dispute, 1957, Volume XVII

427. Memorandum of a Conversation, Ambassador Engen’s Office, New York, December 17, 1957¹

New York, December 17, 1957

SUBJECT

• Palestine Refugee Problem

PARTICIPANTS

• Ambassador Hans Engen, Norwegian Permanent Representative to the United Nations
• Mr. Per Thee Naevdal, First Secretary, Norwegian Delegation to U.N.
• Mr. Henry S. Villard, Special Assistant to the Under Secretary
• Mr. Charles D. Cook, USUN
• Mr. David L. Gamon, UNP

Mr. Villard called on Ambassador Engen at the latter’s office pursuant to the suggestion made in the Secretary’s letter to Ambassador Engen dated December 9, 1957.² Mr. Villard asked if Ambassador Engen had had an opportunity to give more thought to the refugee problem. Ambassador Engen replied that he had had recent conversations with the Secretary General and with Foreign Minister Fawzi of Egypt which had given him an opportunity to think over the matter. Fawzi, with whom he had had a general conversation on Middle East matters, felt that there was a need to approach two important problems before a Palestine settlement could be considered. The first pertained to Algeria. He thought it was necessary for the French to get at the underlying political elements in the problem and to arrive at a Tunisian or Moroccan type of solution. The second matter to which attention should be given was in the economic field. Fawzi believed that the Arab League might take the initiative to request the United Nations to undertake an economic survey of the area. This presumably would stem from the conversations Mr. Black has had in Cairo. The International Bank, according to Fawzi, would help an Arab investment bank by furnishing the latter with technical assistance and advice on likely sources of financing. The International Bank would not itself furnish any funds and it could not do so until Egypt would have settled the matter of compensation to shareholders of the old Canal Company. With regard to the Pella plan³ there were many objections but Fawzi, nevertheless, had been planning to discuss this in Rome.

Engen believed that Fawzi’s interest in the economic development of the Middle East was most significant. It had followed a similar interest expressed previously to the Secretary General by the Iraqis. The important thing, according to Engen, was to get the Arabs united on an issue in which they would not be watching each other with suspicion. The lack of a unified Arab attitude, Engen felt, has been the main reason why no progress has been possible on the Palestine issue. The interest in the economic approach, on the other hand, promised just such a unified attitude. Moreover, the Arabs are agreed that the only outside agency in which they have general confidence is the United Nations. The main problem is how to reconcile the political divergencies with a general desire on the part of the Arabs to get going in the economic field. Egypt could play a useful leading role in this. Engen thought that his conversation with the Secretary and his recent talks in New York had confirmed the view that it would be better to allow full play to Arab interest in economic development plans and to allow these to be worked out undisturbed by political considerations and without respect to any particular issue in the Middle East. Ambassador Engen was therefore inclined to suggest that no definite steps be taken in Middle East political matters until after the Secretary General had concluded his visit to Cairo and until after the Arabs will have had an opportunity to take an initiative in approaching the United Nations for assistance in economic development. He estimated that this might take some two or three months. Meanwhile, he said, we should maintain a discreet and effective contact with the Arabs in order to keep a finger on the Arab pulse.

Ambassador Engen admitted that what he had in mind was nothing like a short term settlement of the refugee problem. However, he warned against doing anything that could be interpreted by the Arabs as an attempt to resolve the Palestine question or the refugee problem at the present time.

Mr. Villard stressed the difficulties confronting the United States Government in its efforts to get Congressional support for UNRWA when there appeared to be no solution to the refugee problem in sight. He had hoped that Ambassador Engen would have felt it possible to take an initiative on the matter of the Palestine refugees. Ambassador Engen said he did not feel that an attempt at such an initiative would stand a chance, although he recognized the problem of obtaining Congressional support for UNRWA. His own Government had a similar problem.

Mr. Villard asked for the Ambassador’s reactions to a hypothetical situation in which Israel were to announce its acceptance of the principle of repatriation. The Ambassador replied that, if Israel were seriously to announce its acceptance of the principle of repatriation in such a way that its sincerity could not be doubted, and if it were made evident that Israel would have the necessary funds to carry out the compensation plan, a major step in eliminating the refugee problem would have been taken. The main problem was that of funds. Mr. Villard pointed out that the Secretary’s offer of 1955 in regard to an international loan to Israel for this purpose still stood and that it was reasonable to expect that Congress would give the plan its support. However, no one had yet put the matter up to the Israelis in strong terms. Ambassador Engen commented that the United States was in the best position to do that. It alone had the funds that could serve as an inducement to Israel and that would make it possible to pay compensation. He, on the other hand, did not have access to such resources. In considering any approach to Israel, Ambassador Engen stressed that timing was important in this, too. It should not be done at a time when it could be associated with the Secretary General’s trip to the Middle East.

Mr. Villard mentioned that he had been considering a purely personal idea that had no official status in the Department, whereby Gaza would be put under United Nations administration or supervision for a period of, say, ten years. During that interim everything possible would be done to develop local resettlement opportunities there and to bring refugees slowly out of Gaza to other places as, for example, Iraq. Ambassador Engen responded that events in Gaza last winter were still too fresh in everyone’s mind to propose such a step for the Gaza Strip at this time. However, he would not wish to exclude the possibility of such a development sometime in the future. In this connection, he recalled that Foreign Minister Fawzi had spoken to him of the possible transfer of Gaza refugees to areas in Egypt opposite Ismailia. This seemed to be a reference to the old scheme to resettle Gaza refugees in areas to be irrigated with Nile waters.

In conclusion, Ambassador Engen felt that the time was not proper to attempt a political settlement or to focus on the Palestine issue. He agreed with Fawzi’s thinking that the refugee problem could not be solved by means of a political settlement and that the only way to approach the refugee problem was an effort to eliminate it. Meanwhile, full scope should be given to the Arabs to work out their economic development plans without the distraction of political issues. While he was extremely cautious about the diplomatic approach, he did not wish to leave the impression that he thought it should not be tried, given the proper circumstances. He felt that events in the Middle East might soon develop in such a way as to make a diplomatic approach possible.

Mr. Villard suggested that Ambassador Engen sound out the Secretary General upon his return from the Middle East, at which time he would be glad to come back to see Ambassador Engen again. Ambassador Engen agreed to do this and to suggest a time for another meeting, presumably early in January.⁴

1. Source: Department of State, Central Files, 884.411/12–757. Secret. Drafted by Gamon.
2. In the letter, Dulles expressed his strong desire that Engen carry out discreet explorations with Near East governments concerning aspects of the Palestine question and advised that Villard would stay in touch with him. (Ibid., 320.511/12–957)
3. Reference is to a plan advanced by Italian Foreign Minister Giuseppe Pella to assist the economic development of the Middle East. Documentation on U.S. reaction to the plan is scheduled for publication in volume XII.
4. On December 23, Villard met with representatives of the Bureau of International Organization Affairs and the Bureau of Near Eastern, South African, and Asian Affairs to discuss the next step in the Palestine refugee problem. A memorandum by Villard in preparation for the meeting is item No. 33 of the Villard Study. (Ibid., 320.51/7–257) The following day, Villard forwarded to Herter a memorandum requesting a meeting with him in order to discuss Villard’s recommendations of December 3 (see Document 416) and the possibility of approaching Eban on the repatriation question. (Item No. 34 of the Villard Study)