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The Foreign Secretary hoped that in the next month or two agreement
might be reached to resume relations not only with the UAR but also with
the other countries which had broken relations with us over Rhodesia
in December 1965 and with which President Nasser was already in touch.
Meanwhile it was expected that a large part of the UAR forces would
have left the Yemen by the end of October and the balance by 15th December.
Our own withdrawal from South Arabia and the UAR withdrawal from the Yemen
night coincide. In the United Nations we were still working to secure
the passage through the Security Council of a balanced resolution providing
not only for Israeli withdrawal fron occupied Arab territory but also
for recognition by the Arab States of Israel's right to exist. Such
a resolution would be a basis for the re-opening of the Suez Canal.
The Soviet Union would support such a resolution if the moderate Arab States were prepared to do so. The Soviet Foreign Minister, Mr. Gromkyo,
had indicated that the Soviet Union had no interest in encouraging the
extremist Arab States Syria, Algeria and Iraq. On the other hand the
Israeli attitude had hardened and was making progress in the United
Nations more difficult.
In discussion it was pointed out that as a result of the Middle East
crisis and a slowing down in our exports to the United States and Germany,
we should have a deficit of between £200 and £300 million on our balance
of payments this year, and the prospects for a surplus next year had been
reduced. We might try, through the developing countries, to bring
indirect pressure to bear on Israel to accept an arrangement which would enable the Suez Canal to be re-opened. The situation would also be
improved if oil supplies from Nigeria could be resumed as soon as possible
now that the Federal Government seemed to have the upper hand in the
fighting against the breakaway Eastern Region.
THE PRIME MINISTER, summing up the discussion, said that the prolongation of the crisis in the Middle East would have serious consequences for
our balance of payments. It was therefore important to do everything
possible to make Israel understand the price we were paying for giving
her moral support and to induce her to adopt a more accommodating attitude
at the United Nations. The 50th Anniversary celebrations of the Balfour
Declaration in early November offered an opportunity of stating the
Government's attitude. The Lord President of the Council who would be
speaking at a meeting in London organised by the Zionist Federation of
Great Britain, and the Postmaster General who would be representing Her
Majesty's Government at the celebrations in Israel, should have this in
mind in preparing the speeches which they were due to make; and they
should circulate, în advance, the drafts for discussion with those of
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