Paying for the Canal

This week, 21 months after Gamal Abdel Nasser's seizure of the Universal Suez Canal Co., the issue of compensating its owners approached settlement by due process of law and due pressure of power politics. Nasser was feeling the hurt of having $280 million in Egyptian assets frozen in the U.S. and Britain. Under the good offices of the World Bank, whose President Eugene Black himself flew to Cairo at the sticking point last month to press compromise on his friend Nasser, representatives of the old Canal Co. and the Egyptian government got together on a "general" financial agreement. Egypt's payment for the company's shares has been privately agreed upon, and is reportedly somewhere between $40 million and $70 million. The British and French shareholders gave up their unrealistic claim to compensation for revenues lost over the remaining twelve years of their concession. The Egyptians dropped their claims to the company's $137 million assets abroad, and the bank dropped hints on how Nasser might more profitably operate the canal. He might pay the company in installments out of his $115 million-a-year canal tolls, and the bank might consider advancing him cash, and is already offering him technical advice, to widen and deepen the ditch for the ever-growing oil traffic.

The State Department, pressing for an early settlement, let it be known that when it is reached, the U.S. plans to unfreeze $30 million in Egyptian assets blocked in the U.S. after Nasser grabbed the canal. The State Department insisted that the assets had been frozen only against the possibility that U.S. shippers, after paying Suez tolls to Egypt, might later learn that the tolls were legally owed to the old Suez Co.

Whether all these settlements would decrease the anti-American poison spread by the captive Cairo press or broadcast by Cairo propaganda stations remains to be seen. At the moment Nasser was off to Moscow--to be guest of honor at the May Day parade.

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