Wendy Lewis

Citation: 1950 vol. V The Near East South Asia and Africa 1978 1978 Provided by: <br>SMU Underwood Law Library

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SAUDI ARABIA

INTEREST OF THE UNITED STATES IN QUESTIONS OF ECONOMIC AND MILITARY ASSISTANCE TO SAUDI ARABIA; THE QUESTION OF THE RENEWAL OF UNITED STATES TENANCY AT DHAHRAN AIRFIELD 1

711.56386A/4-1850

Report of the Joint United States Survey Group to Saudi Arabia 2

TOP SECRET [WASHINGTON, undated.]

JUSSGSA FIELD REPORT WITH FINAL RECOMMENDATIONS FOR THE SAUDI ARABIAN ARIY, NAVY AND Am FORCE

GENERAL

1. Introduction

a. The Joint United States Survey Group to Saudi Arabia visited Riyadh for the purpose of discussing with His Majesty the mission of

'For previous documentation on these subjects, see Foreign Relations, 1949, vol. vi, pp. 1573 ff.

2 This report was better known as the O'Keefe Report. It was named after Brig. Gen. Richard J. O'Keefe, U.S.A.F., Commander of Dhahran Airfield, who was the chief of the survey group. The survey team had spent the period from September 1 to October 22, 1949, in Saudi Arabia studying that country's security requirements and ways in which United States requirements at Dhahran Airfield could be correlated with Saudi Arabian military needs. The group's mission was outlined by Ambassador J. Rives Childs to King Ibn Saud in an aide-mdmoire of May 30, 1949, printed, along with other documents relating to the survey group, in Foreign Relations, 1949, vol. vi, pp. 1573 ff. The group's report was completed and submitted on January 3, 1950, to the Joint Chiefs of Staff, U.S. Air Force, for review. He in turn submitted it to the Joint Chiefs of Staff on January 19, 1950, for study as a matter of priority.

The source text was enclosed in a letter from Secretary of Defense Louis A. Johnson to the Secretary of State on April 18, 1950; not printed. In his letter, the Secretary of Defense said the enclosure was a condensation of an abridged report. He recommended that the Department of State transmit a copy to King Ibn Saud together with a statement telling him that a great mass of detail had been omitted, but "the detailed report would be available for the detailed working out of arrangements between his Government and the United States Mission to Saudi Arabia." He further requested the King be informed that: "No action has been taken on the report and no inference should be drawn that it has been approved by the United States Government, particularly as to the size and composition of forces recommended. However, the report is under study." (711.56386A/4-1850)

A memorandum dated June 26, attached to a file copy of the letter, stated that the Department of State had decided in April not to transmit a copy of the O'Keefe Report to the King. An undated memorandum, also attached, said: "The consensus is that this report be placed in our file and not be sent to Jidda. It would only give us headaches we need not have."

A complete copy of the O'Keefe Report is in the Department of Defense files.

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SAUDI ARABIA

the survey group. It was decided that the first objective would be an on-the-site study of Saudi Arabian defense requirements, and would be conducted with Saudi Arabian Army members. American members of the survey group would also determine United States requirements at Dhahran for future consideration in connection with long-term agreement negotiations.

b. To accomplish the mission of the survey group, a number of dis- tinguished military experts representing the three Armed Forces of the United States were chosen by the Department of Defense. These military experts are currently occupying positions of great responsi- bility in their respective services in Washington. All of these officers achieved records of outstanding distinction in the past war. The United States Government was very careful to select qualified officers who had the theoretical knowledge of military affairs and also required these officers to have a background of extensive military experience under actual battle conditions. His Majesty assigned five Saudi Arabian Army Officers to the survey group to represent the Kingdom of Saudi Arabia in accomplishing the assigned mission.

c. His Majesty was informed that the group would establish head- quarters at Dhahran Airfield and would cover the Arabian Peninsula by vehicle and aircraft to accomplish the on-the-site study of the Saudi Arabian Government's internal security. Headquarters, United States Air Force, in Washington, directed that Dhahran Airfield would logistically support the survey group mission. Since the Arabian American Oil Company had extensive experience in Saudi Arabia, and facilities throughout the eastern part of the Arabian Peninsula, the oil company was asked to assist the survey group in its mission. Mr. Floyd Ohliger, Mr. George Johnson, and Mr. Richard Kerr were the principal Aramco officials who contributed much of their time and effort to the successful completion of the survey group's studies. Mr. Kerr acted as Liaison Officer between the survey group and Aramco, and accompanied the survey group on all of the ground vehicle sur- vey trips in the capacity of Field Manager. It is pertinent to state at this time that the on-the-site study would have been impossible without the full cooperation of the Arabian American Oil Company. Both the Saudi Arabian Government and the United States should be grateful to Aramco for their unselfish efforts in accomplishing the survey group's mission.

2. Travel a. The survey group made four separate vehicle trips. The routes

covered were, generally, throughout the Hasa Province, the southern Nejd east of the Tuwaiq Mountains, the northern territories in the vicinity of the Tapline, and the central Nejd in the Hailburaida dis-

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FOREIGN RELATIONS, 1950, VOLUME V

trict. Total vehicle travel in the above areas was 3,825 statute miles. Survey groups objectives in vehicular travel were:

(1) Terrain study. (2) Climate. (3) Local tribes. (4) Saudi Arabian Army garrisons and outposts. (5) Equipment, arms and training of Saudi Arabian froops.

It was felt that more extensive vehicle travel in the Arabian Penin- sula was desirable; however, in the interest of expediting the mission, vehicular travel was kept at a minimum.

b. Vehicular observations were supplemented by air trips through- out the Arabian Peninsula, the Red Sea area, and the Gulf of Aden. The entire Arabian Peninsula was covered by air with the exception of the Trucial Oman, Muscat, Hadhramaut, and the extreme eastern Rub 'Al Khali. Aerial surveys were made by the survey group in thirteen separate air trips which traversed air routes of 10,988 statute miles. The aerial survey objectives were:

(1) Road observations. * (2) Topography.

(3) Invasion routes. (4) Defensive areas. /5) Coastlines. 6) Large centers of population. 17) Large areas of cultivation. 8) Natural terrain barriers.

(9) Airfields and airstrips. (10) Ports.

The distances travelled, as enumerated above, included only route miles. In addition to the route miles traversed, the Air Rescue Service unit of Dhahran Airfield supported the survey group in the field by forty-eight support missions which traversed 27,310 statute miles.

The Air Rescue Service unit also performed six photographic mis- sions covering 6,315 statute miles. To summarize, the Joint United States Survey Group's studies required a total of 44,613 statute miles of travel by vehicle and aircraft.

3. Economic a. The survey group followed the American concept of military re-

quirements; namely, (1) simplicity, (2) economy, and (3) mobility, in recommendations for the Saudi Arabian Army, Navy and Air Force. This concept resulted in the determination that all vehicles for the Armed Forces should be commercial vehicles suitable for the needs of Saudi Arabian defense and, at the same time, capable of use by the Saudi Arabian Government in support of normal government opera-

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SAUDI ARABIA

tions. The type of vehicles should be, in genera], such as those now being successfully used by the Arabian American Oil Company in Arabian desert operations. In addition, the Air Force Troop Carrier aircraft should be suitable not only as troop carrier aircraft, but also for commercial airline operation of the government-owned Saudi Arabian Airlines. Communications, airfields, maintenance shops, etc., should have the dual use of supporting the Arabian Government operations and being readily available if required for the defense of the Kingdom.

b. The American members of the survey group have followed the instructions of His Majesty in making the on-the-site survey of Saudi Arabian defense needs by placing themselves in the position of the Saudis and assuming that it was their mission to defend Saudi Arabia from its enemies. In following these instructions, the survey group has arrived at conclusions which must be carefully analyzed by the Saudi Arabian Government with regard to the ability of the govern- ment and its financial structure to support the military organization recommended.

c. National Defense budget data obtained from eighteen major and minor nations may be used *by the Saudi Arabian Government in arriving at some conclusion as to its ability to support the recom- mended Saudi Arabian Army, Navy and Air Force. In terms of the national income, these eighteen nations obligated to the defense estab- lishment, an average of 6 per cent of the total national income. Also these eighteen nations averaged, for defense needs, 19 per cent of the total government expenditures. During the survey group's visit at Riyadh with His Majesty, Shaikh Yussef Yassin 3 and Bey HaInze

were asked to keep these figures in mind as a wise guide for the type of military equipment and the extent of the military establishment which would be desirable for Saudi Arabia. In view of the lack of official figures relative to the Saudi Arabian Government's national income and budget for the coming year, with a five year forecast, the survey group roughly estimated that the total national revenue for 1949 would be approximately eighty-five to one hundred million dollars.

d. The recommended defense organization for Saudi Arabia is considered by the survey group to be a desirable organization rather than an essential one. The organization can be reduced in strength and cost as determined by the Saudi Arabian Government, keeping in mind that the existing defense organization is in such condition that it requires complete reconstruction, reorganization, re-equipping

'Deputy Foreign Minister of Saudi Arabia. ' Fuad Bey Hamza, Adviser to the King.

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FOREIGN RELATIONS, 1950, VOLUME V

and training; therefore, the initial cost of the recommended defense organization might appear to be beyond the ability of the Saudi Arabian Government to support it.

e. The recommended defense organization is planned on a five-year program for reconstruction, re-equipping and training. This five- year program is based upon a smooth coordinated effort by both the Saudi Arabian Government and the United States Government. There will be unforeseen delays which might easily extend the recommended five-year program. It is suggested that the Saudi Arabian Government arrange for distribution of initial defense costs over a period of years which would be commensurate with its national income. It is not con- sidered infeasible that the Saudi Arabian Government could budget twenty million dollars each year to its Department of Defense.

!. In obligating Saudi Arabian defense funds to support the recom- mended defense organization, the Saudi Arabian Government should consider that these costs accomplish a great deal in addition to provid- ing a strong defensive force. Implementation of the defense organiza- tion will not only provide a strong internal security for the Kingdom, but will contribute to the progress of the people and the government in improved communications, improved airfields, construction of many types of facilities such as roads, maintenance shops, etc., and 'above all else, will institute a technical and educational program which will be available to a large bulk of the Arabian population.

g. The American training required for implementation of the recom- mended defense organization will be made extremely difficult by the scarcity and, in some cases, the total absence of an adequate elementary and scientific educational program for children and young men of the Kingdom. It is strongly recommended that the Saudi Arabian Gov- ernment take the necessary steps to establish an adequate educational program with recognized standards which will prepare the youth of Saudi Arabia for future service in the defense organization. Basic knowledge acquired by youth during at least eight years of elementary school and possibly four years of high school are very necessary in preparing them to absorb the knowledge required of a modern soldier using modern weapons.

h. If the recommended defense organization is to serve its purpose, it must have full support of its government, financial and otherwise. The defense organization and its General Staff must be organized in such a manner that it will only be under the authority of the Minister of Defense and not be subject to the will or the desires of local Amirs. To accomplish this, the defense organization must be entirely inde- pendent of local Amirs in garrisons, billeting, messing and all support- ing facilities. In other words it must be an instrument of His Majesty and Minister of Defense and no one else.

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SAUDI ARABIA

SUMMARY OF REQUIREMENTS

4. Army

a. The survey group recommends that the Saudi Arabian Army con- sist of approximately 2,700 officers and 39,700 enlisted men organized into:

(1) A GHQ. (2) Reserves for GHQ. (3) Two infantry divisions. (4) Reserves for two divisions. (5) Parachute Infantry Combat Team. 6) TD Battalion. 7) Miscellaneous service support units such as medical, ordnance,

quartermaster, signal, engineer, motor pools, and reserves.

b. The recommended Saudi Arabian Army will be trained and ad- vised by a United States Army cadre consisting of about 150 American Army Officers and 240 Enlisted Men. . c. The armament would be modern and that which is normal in the

American Army for the recommended units. Ammunition required for a five-year training period will also be necessary.

d. The initial cost for equipping the Army and construction of the necessary facilities is calculated at approximately $80,000,000. This figure is broken down into $46,000,000 for combat units (including trucks, communications, uniforms, and individual equipment); $20,000,000 for service units; and $14,000,000 for construction of items such as barracks, training buildings, instructor (U.S.) quarters, signal repair shops and field hospitals. In addition, in order to provide for the initial Army training at Dhahran Airfield, it will be necessary that additional Army construction be provided at a cost of about $1,700,000.

e. All costs are roughly estimated and are subject to major changes. It is contemplated that exact costs will be discussed in detail during final negotiations. Costs listed do not include Saudi Army pay, sub- sistence, billeting, nor maintenance cost of the Saudi Arabian Army during its training or active service periods. The costs enumerated above simply include the cost to Saudi Arabia of military equipment which must be provided by the United States to include some facilities necessary to the Saudi Arabian Army and the American Army train- ing program.

5. Navy a. The survey group recommends that the Saudi Arabian Navy

consist of approximately 50 Officers and 215 Enlisted Men organized ito:

(1) A Naval Headquarters. (2) Two Naval Bases.

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(3) Persian Gulf Fleet of:

2 PGM (Motor Gun Boats) 2 PT (Motor Torpedo Boats) 2 LCS (S) (Landing Craft Support Small)

.3 ML (20 to 26 ft.) (Motor Launches)

(4) lRed Sea Fleet of:

2 PT 2 LCS (S) 3 ML

b. The recommended Saudi Arabian Navy will be trained and ad- vised by a United States Navy cadre consisting of three American Naval Officers and eight Enlisted Men.

c. The armament would be modern and that which is normal in the American Navy for the recommended units. A complete set of spare parts will be provided for all engines and for radio and ordnance equipment. Necessary training ammunition will also be necessary.

d. The initial cost for equipping the Navy and construction of the necessary facilities is approximately $7,800,000. This figure is broken down into $6,500,000 for vessels; $1,200,000 for bases (construction of training buildings, storage, quarters, headquarters, kitchen, etc.); and $100,000 for a five-year ammunition training allowance. All costs, as in the case of the Army, are roughly estimated, subject to change, and do not include Saudi Navy pay, subsistence, or maintenance cost of the Saudi Arabian Navy during its training or active service pe- riods. The costs enumerated above simply include the cost to Saudi Arabia of Naval equipment which must be provided by the U.S. and, in addition, the cost of Naval base facilities which must be constructed by the Saudi Arabian Government, to include training facilities.

6. Air Force a. The survey group recommends that the Saudi Arabian Air Force

consist of approximately 107 Officers and 755 Airmen. b. The recommended Saudi Arabian Air Force will be trained and

advised by a United States Air Force cadre consisting of 26 American Air Force Officers and 38 Airmen.

c. The major items of equipment and facilities for the Saudi Arabian Air Force are:

(1) 28 Super C-47 twin-engine Transports. (2) 5 C-54 four-engine Transports. (3) 2 Major Air Bases. (4) 2 Major Airfields. (5) 8 Minor Operational Airfields. (6) 12 Weather Stations (all airfields). (7) 4 Major Airways Communication Centers.

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SAUDI ARABIA

Necessary training ammunition will be necessary. d. The initial cost for equipping the Air Force and construction of

the necessary facilities is approximately $19,700,000. This figure is broken down into $10,300,000 for tactical and service units (including 33 transports) ; $3,500,000 for construction (housing, airfields, storage, runways, etc.); and $5,900,000 for spare parts, packing, shipping and maintenance. In addition, in order to provide for Air Force training at Dhahran Airfield, it will be necessary that additional Air Force construction be provided at a cost of about $26,200,000.

e. All costs are very roughly estimated and are subject to major changes. It is contemplated that exact costs will be discussed in detail during final negotiations. All costs recommended do not include Saudi Arabian Air Force pay, subsistence, nor maintenance costs for the Saudi Arabian Air Force during its training or active service periods. The costs enumerated above simply include the cost to Saudi Arabia of military equipment which must be provided by the United States to include airfield facilities throughout the Kingdom very necessary to the Saudi Arabian Air Force.

f. Attention is invited to construction required at Dhahran Airfield for Saudi Arabian Army and Air Force training. It will be noted that in the event the U.S. undertakes training for the Saudi Arabian de- fense organization, it will be necessary to expand the present facilities of Dhahran Airfield at a cost of about $27,900,000 (Army and Air Force combined). The expansion of Dhahran Airfield would then provide for housing and maintaining some 500 American military personnel, and, in addition, provide family quarters for an additional 53 American military families. The expanded facilities will also pro- vide for 500 civilian personnel which would be necessary for the ad- ministration and maintenance of the expanded airfield. Additional housing, messing, and training facilities are provided in the program to process 70 Arabian Army and Air Force students undergoing train- ing at Dhahran. The expanded airfield and its facilities would provide for an Army training program with an Arabian Army student body of 117 Officers and 117 Noncommissioned Officers at one time. The Air Force training program would provide for a Saudi Arabian student body of 100 Officers and 200 Airmen. Saudi Arabian Navy training will be conducted at one of the selected naval bases with a student body of 150 personnel and a 9 month course duration. Three such courses will be conducted consecutively by U.S. Navy instructors.

7. Training a. In addition to the Saudi Arabian Army, Navy and Air Force

student training noted in paragraph 6f above, it is contemplated that

538-188-78-72

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FOREIGN RELATIONS, 1950, VOLUME V

selected students would receive training at appropriate U.S. Service schools in the United States in accordance with the following table:

Army: (1) During first three years: Two separate groups of 59 Officers and 58 Enlisted Men each.

(2) During last two years: Two separate groups of 69 Officers and 58 Enlisted Men each.

Navy: (1) During first two years: One group of 15 Officers and 52 Enlisted Men.

Air Force: (1) During last four years: Four separate groups of 30 Officers and 50 Airmen each.

611.86A/1-1750: Telegram

The Secretary of State to the Embassy in Saudi Arabia'

CONFIDENTIAL WASHINGTON, January 17, 1950-7 p. m. 17. Review your recent conversations with SAG indicates six impor-

tant questions are of continuing interest: (1) possible mil moves against SA (Deptel 451 Dec 2 2); (2) possible mil moves by SA (Embtel 5 Jan 4 3) ; (3) mil assistance to SA; (4) DAB; 4 (5) FCN; (6) Civil Air Agreement (last four in Embtel 730 Dec 19 5).

Dept realizes most these questions interrelated but believes all of them shld be handled and discussed separately with SAG in so far as possible. Method of handling will depend on developing circum- stances. Some might be resolved through Emb; in other cases it may be necessary handle by providing you temporarily with expert assist- ants from US. SAG shld not, however, be permitted gain impression that USG is prepared in near future to undertake overall negots or series of talks at which all of reference questions will arise for dis- cussion and immediate solution. Dept fears if SAG entertains hope of simultaneous solution of all important problems in near future sub- sequent delay or failure may prove disillusioning and thereby affect US-SAG relationships adversely.

'Repeated to Cairo, Baghdad, Damascus, Beirut, Tel Aviv, Jerusalem, Amman, and London.

2 Not printed; but see editorial note, Foreign Relations, 1949, vol. vi, p. 1624. 'Not printed; the Ambassador reported a call at 'his residence by Yussef Yassin

to inform him that any action of Jordanian or Iraqi forces toward Syria would precipitate retaliatory action by Saudi Arabian and Egyptian forces (786A.00/ 1-450).

For further information on this topic, see Foreign Relations, 1949, vol. vi, pp. 180 if.

'Dhahran Airfield was built by U.S. armed forces in 1946 and was operated by the Air Transport Command in an agreement with the Government of Saudi Arabia. The current agreement was to last until June 1950.

'Foreign Relations, 1949, vol. vi, p. 1628.

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SAUDI ARABIA

For example, suggested threat of any NE mil move against SA may be removed by developments in other Arab States and in NE as whole but these may require months and possibly years. Under exist- ing circumstances no possibility foreseen of US Govt independently going beyond position taken in Deptels 93 Mar 23 6 and 451 Dec 2.1 Furthermore any advance in position wld probably be within frame- work of UN. It is important therefore you use every occasion reestab- lish prestige of UN in eyes SA officials. Other questions, such as mil assistance to SA, are dependent on consideration of O'Keefe report 8 by JCS and Congressional MAP action. Meanwhile reference is made to Deptel 407 Oct 15 9 which contains possible approach if SAG fur- ther presses question mil assistance. Still other questions, such as DAB and possibly Civil Aviation Agreement, will arise for earlier con- sideration. Meanwhile Dept is studying means for solving these ques- tions. 'Consideration is also being given to FCN.

With specific reference to possible mil moves by SA as reported in Embtel 5 Jan 4, you are authorized orally inform SAG that Dept recalls statement of Dec 5 (Deptel 451 Dec 2) and that it also recalls USG has long maintained policy of opposing any modification of frontiers or governmental structure of NE states through interven- tion or external force. USG has and will continue to make known these views to NE States as occasion warrants.

It shld always be made clear to SAG, in event it indicates impa- tience or dissatisfaction with USG views, that USG desires continue closest relations of friendship with SAG and work with it in reaching satisfactory solution outstanding questions between us. At same time USG feels and believes SAG shld agree, fol serious reflection, that relations between USG and SAG are basically good. They therefore shld not be permitted to deteriorate by acquiescing in development of state of mind among SAG officials wherein USG is partly responsible for bad relations existing between SAG and some of its neighbors. It is suggested that many complaints currently addressed by SA officials to Emb shld be handled by turning back on the spot rather than by informing officials their views are being reported to Dept for study.

ACHESON

Not printed, but see footnote 1, Foreign Relation, 1949, vol. vi, p. 1584. Not printed, but see editorial note, ibid., p. 1624. See p. 1112. Printed In Foreign Relation8, 1949, vol. vi, p. 1615.

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FOREIGN RELATIONS, 1950, VOLUME V

611.86A/2-150: Telegram

The Ambassador in Saudi Arabia (Childs) to the Secretary of State'

SECRET JIDDA, February 1, 1950-1 p. m. 62. Deptel 17 January 17.2 It would be most helpful if we could

have as soon as possible information re (1) present status considera- tion O'Keefe report by JCS; (2) plans Department concerning MAP action; (3) results explorations mentioned paragraph 3 Deptel 407 October 15 last; 3 (4) present status availability to SAG informal guidance for Commercial procurement military equipment, or possi- bility certain supplies from army surplus. See Embtel 573 Septem- ber 27.

It is as certain as anything can be SAG will expect US soon enter DAF negotiations with proposals MAP. Department will recall short term extension DAF agreement last June - for one year predicated on positive expectation USG would during ensuing 12 months examine means by which MAP might be devised to warrant long-term agree- ment and fulfill King's wishes for internal security which he has been demanding with increasing forcefulness for more than 10 years.

Time is rapidly approaching when I shall again be 'asked by King re status our plans to help him.

In connection MAP assistance for SAG I am of course concerned by recent publicity Javits' comments 6 which are certain eventually reach SAG if not already in their hands and which may serve stimu- late apprehensions their part.

As of course Department aware there is no more important prob- lem in US relationships with SAG than this question military aid and DAF negotiations listed as points 3 and 4 Deptel 17 January 17. Time rapidly approaching when it must come to head OSR-DAF agreement expires in June.

Department will no doubt realize my position here will be practically untenable unless I can furnish King with concrete evidence of what we intend to do to help him and time about past when promises re our future intentions will carry much weight with him.

'This telegram was repeated to Cairo, Baghdad, Damascus, Beirut, London, Tel Aviv, Jerusalem, Amman, and Dhahran.

'Supra. 8 Printed in Foreign Relation8, 1949, vol. vi, p. 1615.

Not printed, but see footnote 1, ibid., p. 1616. 'For information on the June agreement, see despatch 179, July 20, 1949,.

from Jidda, and enclosures thereto, ibid., p. 1602. 'Jacob K. Javits, United States Representative from New York, criticized the

reported export of British arms to the Arab states in two letters to Secretary of State Acheson, dated December 28, 1949, and January 26, 1950, not printed, which Javits also released to the press. For the Secretary's answer to the first letter, dated January 12, 1950, see p. 684.

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I realize delicate question on MAP to SAG in light Israel but I feel strongly we should approach question not from point view aid to an Arab country but aid for country which is helping us out and is ex- tremely important to US strategically. Aid should be viewed not as aid to Arabs but as aid which seconds US interests.

CHILDS

611.86A/2-150: Telegram

The Secretary of State to the Embassy in Saudi Arabia

SECRET WASHINGTON, February 9, 1950-4 p. m.

49. Reply your nr points Embtel 62 Feb 1: 1

1) We anticipate O'Keefe report which JCS comite now studying will be taken up by JCS fol their return from Far East.2 No indica- tion when their consideration will be completed.

2) Dept reexamining question seeking legis auth for mil asst for countries (including SA) other than those covered by present mil asst legis. Further info fol. Congressional action of course cannot be foretold.

3) USG may only provide mil asst including sales of surplus to countries presently authd receive mil asst and to members with US collective defense and regional arrangements; consequently only al- ternative appears to be commercial purchase available items in open market.

4) Dept remains willing as stated Deptel 407 Oct 15 3 to offer SAG informal guidance in contacts for commercial procurement and gen- erally favorable export license consideration. Initiative for commercial procurement rests with SAG. 'SAG might take prelim step authorizing reps or agents in US investigate open market for available items in mil and particularly in non-mil categories.

Dept realizes extent to which King relates mil assistance to DAB but believes, as indicated Deptel 17 Jan 17, 4 we shld make strenuous effort handle and discuss separately if possible. Pending USG action under 1) and 2) Dept believes SAG action under 4) shld have effect partially allaying SAG apprehensions and providing evidence means by which US can assist at this stage.

Reference recent publicity with respect Brit mil asst Arab states, ME file (item no. 7, Jan 16 5) containing text Sec's reply Javits, in- dicates USG attitude and shld provide basis for positive response if SAG raises question.

I Supra. 'The Joint Chiefs of Staff spent late January and early February 1950 in the

Far East. 'Foreign Relations, 1949, vol. vi, p. 1615. 'Ante, p. 1120. 'The editors are unable to identify this reference.

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FYI only McGhee wrote Johnson Feb 6 6 re June 23 expiration DAB agreement and proposed negots for extension. In requesting asst of Defense in preparation for these negots, McGhee stated Dept was studying MAP for SA during fiscal 1951 and observed JCS findings on basis O'Keefe report wld undoubtedly have important bearing on reimbursable MAP for SA and extension DAB agreement. McGhee suggested it wld be helpful if JCS findings eld be expedited.

AcIIEsON

6The letter to Louis A. Johnson, Secretary of Defense, was written for the Secretary of State by George C. McGhee, Assistant Secretary of State for Near Eastern, South Asian, and African Affairs; not printed (711.56386A/2-650).

An answer from Maj. Gen. James H. Burns, Assistant to the Secretary of Defense for Foreign Military Affairs and Military Assistance, dated February 13, not printed, stated that the Department of State would be notified as soon as the Joint Chiefs of Staff submitted their recommendations on the O'Keefe Report. He further informed the Department that the Secretary of the Air Force was being asked to designate a representative for informal discussions on tentative arrangements for handling tire proposed negotiations with 'the Saudi Arabian Government. (711.56386A/2-:1350)

A letter from Burns to McGhee, dated May 9, not printed, informed him that Col. Howard Moore, United States Air Force, had been so designated (711.56386A/ 5-950). In a letter to McGhee on November 13, not printed, Burns reported that Col. Richard D. Wentworth had subsequently been designated the Air Force representative to work with the Department of State in handling the arrange- ments for negotiations with the Saudi Arabian Government (786A.5/1-1350).

S86A.10/2-1350: Telegram

The Ambassador in Saudi Arabia (Childs) to the Secretary of State 1

TOP SECRET JIDDA, February 13, 1950-4 p. m. 78. I discussed at great length, but in very general terms, with

Crown Prince Saud on February 8 at Dhahran deplorable state ad- ministration finances by SAG. Upon conclusion my remarks Saud said: "I' wish thank you from bottom my heart for friendliness which has inspired your comments. I wish you know I will always welcome expression any opinion from you which you may feel disposed express on any matter.

"I am fully aware of situation you have mentioned which has been source of deep disturbance to me for some time past. Situation is one by no means confined to Ministry of Finance but extends to almost every administration of government.

"You will appreciate that I am in very peculiar and delicate posi- tion. I recognize fully problem and fully share your own views and conclusions you have drawn regarding necessity of thoroughgoing reforms. I -am deeply aware my responsibilities. However, my father

'Repeated to London, Cairo, Damascus, Baghdad, Beirut, and Amman.

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is not equally as aware of this situation on account his age and the difficulty he has in adjusting himself to modern advances.

"There is only one person in SA to whom I am unalterably attached and that is my father. I will do nothing to hurt him or prejudice his state of mind or his health. I shall act decisively when I have power and I shall spare no one in taking necessary measures I recognize to be necessary for well-being of my country whose interests I place above everything else in life except my religion."

Crown Prince informed me also that his father's advisers, referring particularly to Finance Minister, 2 have his ear and confidence to such extent that anything he, Crown Prince, or his brothers might say in writing existent state of affairs might so severely react on him and his brothers as to prejudice their position. Saud confided to me he had spies throughout SAG administration who were reporting to him per- sonally on everything happening. For some time past he has been studying constitutional and budgetary practices neighboring Arab states as well as Turkey and he directed his private secretary 3 show me draft decree he has prepared providing for new constitution setting up Cabinet, Legislature and Senate along Egyptian model.

He was deeply appreciative my comments and requested me to repeat them to His Majesty without reference to fact I had made them previously to him or that this suggestion had come from him.

This morning in Riyadh I had more than hour's talk with King on same subject, with Fuad 4 as interpreter. -In middle of my talk Fuad said in aside to me "I don't know how to thank you for bringing this subject up. It proves you are real friend of SA. I have been working to this same end for twenty years without result. It is imperative that something be done."

As I anticipated it was extremely difficult to make King understand situation. First of all I feel he has failed considerably during recent months and Crown Prince is also concerned with this phase of situa- tion. King stated several times that he had introduced security in SA as a result his liberality to tribes and he made reference to necessity expenditures by him outside SA to maintain Saudi influence.

I emphasized my remarks were not directed at question of manner in which he disposed his revenues but at their proper conservation and their orderly expenditure. I also said I was not criticizing any indi- viduals but I likened situation to that of once small store whose ac- counts might first have been kept in head of owner but which were now too complex for any one man.

Abdullah Sulaiman, Saudi Arabian Finance Minister. 8 Abdullah Effendi. 'Fuad Hamza, Adviser to the King.

1125

FOREIGN RELATIONS, 1950, VOLUME V

Toward end Fuad remarked in aside he thought it was difficult for King to grasp exactly what I was aiming at. I then said to His Majesty: "I have seen Russian Revolution. We have witnessed recently collapse of great regime in China. World is in state of great turbulence. Changes are inevitable. I cannot speak too seriously in expressing to Your MajeP_;y my belief financial reforms are essential in SA. I have full faith in present stability regime but if situation allowed continue indefinitely it cannot but have seriously adverse effect. I have no axe to grind. I am speaking not as Ambassador but in capacity of Saudi as Your Majesty has so frequently described me. I would have been recreant to extraordinary confidence Your Majesty has shown me if I were not to make my apprehensions known to you. If you do not believe me then take counsel of your sons and of your advisors and if you find my words idle tell my government you have no trust "in me." King stopped Fuad short and said he would not permit him to express any such thought. He then said, visibly moved "I knew you were friend. But you have established it now beyond all question. I want you to feel free to express to me at all times any question which is on your mind with same frankness you have shown today." I added that I had no suggestions offer His Majesty as that would be pre- sumptuous but I hoped he would invite his counselors to look into question and propose remedies.

When I left Fuad said he could not be more grateful. He added he feared nothing radical would come of talk but it could not possibly do any harm and it might well give push toward those reforms for which so many were crying in country.

CHILDS

786A.5/2-1450: Telegram

The Anzbasador in Saudi Arabia (Childs) to the Secretary of State'

TOP SECRET JIDDA, February 14, 1950-1 p. m. 83. ReDeptel 28 February 11.2 In my opinion which is completely

shared by General O'Keefe it will not be possible to keep separate questions of MAP and DAF. After full discussion we believe that in event delays action by JCS on JUSSGSA and consequent delay in obtaining required enabling legislation before 23 June 1950, the mini- mum necessary to maintain our position at Dhahran will be (1) con- crete expression of intent regarding MAP to SAG by Department State and Defense; (2) offer as token demonstration intent to SAG of

1 A note in the margin indicated that a copy of this telegram was enclosed with a letter from Raymond A. Hare, Acting Assistant Secretary of State for Near Eastern, South Asian, and African Affairs, to the Secretary of Defense, dated March 8, p. 1129.

2 The reference appears to be an error. The editors have been unable to identify this message.

1126

SAUDI ARABIA

20,000 M-1 rifles with 1,000 rounds ammunition per rifle to be de- livered on loan (Deptel 201 May 27, 1949,1 paragraph 3). If and when MAP program is authorized, above material would be considered part 38,000 rifles under recommended SA defense organization.

We both hope, however, this palliative may not be considered neces- sary and that we may enter long-term negotiations prior to termination date with such MAP program as may have been approved by that time by State and Defense and for which enabling legislation will have been obtained. In absence such, short-term renewal Dhahran agree- ment may be possible on basis outlined but this is minimum which might probably placate SAG.

CHILDS

Not printed, but see footnote 1, Foreign Relations, 1949, vol. vi, p. 1600.

7S6A.563/2-2150

President Truman to King Abdul Aziz Ibn Saud of Saudi Arabia'

TOP SECRET [WASHINGTON, undated.] YoUR MAJESTY: I am sending you this letter by Mr. George C.

McGhee, Assistant Secretary of State in charge of Near Eastern Affairs, who is making a visit to your country as a representative of this Government.

You will recall that I wrote you on May 23, 1949 2 with regard to the negotiations which were then taking place with respect to the renewal of the Dhahran Air Base Agreement, and that shortly there- after agreement was reached providing for renewal of the previous agreement for a period of one year. Subsequently, Brigadier General O'Keefe of the United States Air Force, at your invitation, visited your country for the purpose of studying the military requirements of Saudi Arabia. I understand that he has already discussed his recom- mendations with you.

General O'Keefe's report is being studied by competent agencies of the United States Government. It is expected that this study, which is an essential prerequisite to a decision as to future courses of action, will be completed shortly. I am sure.you will understand the necessity

' The source text was the draft of a letter, attached to a memorandum from the Secretary of State to the President, dated February 21, not printed. The Secretary recommended that the President sign the letter and have Assistant Secretary of State McGhee hand it to the King during his visit to Saudi Arabia. (786A.563/2-2150)

McGhee was in Saudi Arabia from March 18 to March 25, and met with the King on March 22 and March 23. He delivered a letter from the President during his March 22 visit with the King, presumably this letter, but the editors have not found a copy signed by the President. For a record of MeGhee's visits with the King, see the memorandum of conversations, dated March 23, p. 1146.

2 Foreign Relations, 1949, vol. vi, p. 1599.

1127

1128 FOREIGN RELATIONS, 1950, VOLUME V

for the most careful consideration by the United States Government of such an important matter.

I have followed with great interest the remarkable development of Saudi Arabia under your enlightened leadership. Your country stands as a bulwark to peace in the Near Eastern world. It is gratifying that your leadership extends not only throughout Saudi Arabia but also generally through the Near East.

The United States has always attached the greatest importance to the strong ties of friendship and understanding which bind us with Saudi Arabia. I assure you it is our hope and belief that these ties will always continue.

I avail myself of this opportunity to wish you much continued success and good health.

Faithfully yours, [HARRY S. TRUMAN]

786A.11/3-1.50: Telegram

The Ambassador in Saudi Arabia (Childs) to the Secretary of State

SECRET JIDDA, March 1, 1950-11 a. m. 112. Deptel 69 February 24.' In call 27th on Deputy Foreign Min-

ister, Admiral Conolly 2 and I spoke of availability services Captain Hubbard 2 to proceed Riyadh make examination of King and survey needs drugs and equipment his subsequent treatment by US spe- cialists. - Shaikh Yusuf expressed warm thanks and said he was con- ficlent His Majesty would be very grateful but he would confirm by telegram inquiry Riyadh. At dinner offered by Prince Mansour 5 in name of King to Admiral Conolly and his officers at Palace that night

'Not printed; it approved the suggestion made in telegram 106, February 23, from .Jidda, that Captain Hubbard visit the King before the arrival of a specialist from the United States (786A.11/2-2350).

'Adm. Richard L. Conolly, Commander in Chief, United States Naval Forces, Eastern Atlantic and Mediterranean. Despatch 111, March 13, from Jidda, not printed, contained an account of the visit of the U.S.S. Roanoke and two escorting destroyers to Jidda from February 27 to March 2, a trip previously suggested by the Ambassador as an expression of friendship between the United States and Saudi Arabia. (71.1.5886A/3-1350)

'Capt. H. D. Hubbard, United States Navy, area medical officer on the staff of Admiral Conoly.

'In telegram 105, February 22, from Jidda, Childs sent a request from King Tibn Saud for the help of the United States Government in obtaining the best American arthritis specialist to come to Riyadh to examine him. In addition, he wanted the doctor to bring an assistant who would be able to remain in Saudi Arabia after the specialist left. At two meetings in the Department of State. on February 23 and 24, Fraser Wilkins, Acting Deputy Director of the Office of African and Near Eastern Affairs, and Frederick Awalt, Acting Officer in Charge, Arabian Peninsula Affairs, discussed the request with Shaikh Asad AI-Faqih, Saudi Arabian Ambassador to the United States, and an arthritis specialist from the Mayo Clinic. An account of the visit of the American medical team is in the memorandum of April 30, p. 1169. Further documentation on this subject Is in Department of State file 786A.11. ' Saudi Arabian Minister of Defense.

SAUDI ARABIA 1129

Yusuf stated telegram received expressing King's warm appreciation and stating he would welcome visit Captain Hubbard who left for Riyadh early yesterday morning expecting return today.

I have discussed situation with both Admiral Conolly and Brigadier General R. J. O'Keefe, 00 Dhahran. They concur full with me in opinion it would be in national interest if Department Defense would undertake find most competent arthritis specialist available in any of service departments who would be sent Riyadh, accompanied by as- sistant, as response to original request King. I am the more persuaded to make this recommendation by extremely favorable impression made on King and Crown Prince as result similar mission Lt. Colonel Moffett, USAF.6

O'Keefe suggests clinical assistant to arthritis specialist accompany him with necessary equipment in special mission aircraft in order obtain general health King regarding life expectancy.

CHILDS

o In January 1950 a United States Air Force ear specialist, Lt. Col. Oscar P. Moffett, from Kelly Air Force Base, San Antonio, Texas, visited Saudi Arabia after a request from the King for an American doctor to diagnose Crown Prince Saud's ear trouble. Colonel Moffett reported to Dhahran on January.14 and arrived in Riyadh on January 15. After examining the Crown Prince, Moffett made arrangements for him to enter the Dhahran Health Center, an Arab hospital.

The Ambassador transmitted Moffett's report of his treatment of Prince Saud and other members of the royal family to the Department of State with despatch 34, January 27, from Jidda, not printed, and enclosed a final report-on Prince Saud's medical treatment with despatch 94, March 10, from Jidda; not printed. In that despatch he said Colonel Moffett's visit had made a deep impression on the royal family, and he asked the Department to convey the sincere appreciation of the Embassy to the Department of the Air Force. Hare enclosed a copy of despatch 94 with a letter to the Secretary of the Air Force, dated March 28; not printed. Further documentation is in Department of State file 786A.11.

711.56386A/2-1350

The Acting Assistant Secretary of State for Near Eastern, South Asian, and African Affairs (Hare) to the Secretary of Defense (Johnson)1

TOP SECRET WASHINGTON, March 8, 1950. MY DEAR MR. SECRETARY: I have received General Burns' letter

of February 13, 1950 2 with respect to the Dhahran Air Base Agree- ment which expires on June 23rd of this year.

'A summary of this letter was transmitted in telegram 48, March 11, to the Legation in Ethiopia for McGhee. The telegram, not printed, also informed McGhee that the final Mutual Defense Assistance Program for 1950 and programs and budget estimates for 1951 were scheduled to be submitted to the Bureau of the Budget on April 1, and to Congress on April 20. (786A.5MAP/3-1150)

McGhee -had gone to Africa for a United States diplomatic meeting at Lourenco Marques and then visited a number of African countries. For Information on his African trip, see the editorial note, p. 1512.

2 Not printed, but see footnote 6, p. 1124.

FOREIGN RELATIONS, 1950, VOLUME V

Your cooperation in requesting the Secretary of the Air Force to designate a representative for informal talks with the Department of State is appreciated. It is hoped these talks may commence in the near future.

It is believed advisable in this connection to give particular con- sideration to the question of timing which has arisen. It is understood that the views of the Joint Chiefs of Staff and the Department of Defense with regard to Brigadier General O'Keefe's report will be available during March. On the other hand, it is not expected that the Congress will complete its consideration of the question of military assistance for all countries including Saudi Arabia for the fiscal year 1951 before June. It thei-efore seems likely that, at the time negotia- tions commence between the United States and Saudi Arabia regard- ing the Dhahran Air Base, Congressional action will not be complete and only your recommendations regarding the O'Keefe report will be available.

It is recalled that the Saudi Arabian Government including par- ticularly King Ibn Saud has consistently informed us that although the United States was welcome to use the strategic facilities of Saudi Arabia, it was absolutely essential that military assistance be provided if we wished to enjoy such facilities on a long-range and comprehensive basis. It is even possible that King Ibn Saud might refuse to engage in conversations unless the United States was in a position to give him some indication of the extent to which we were able to provide Saudi Arabia with military assistance.

There is no doubt that such information will be required by the representatives of the United States during negotiations with the Saudi Arabian Government with respect to the extension of the Dhahran Air Base Agreement. It would, therefore, be appreciated if the Department of Defense would give consideration to the question of whether the United States Government would be able to provide Saudi Arabia with some form of military assistance on a token or temporary basis pending Congressional action on presently proposed military assistance legislationA In considering the various forms of

"An answer to this letter from the Secretary of Defense, dated April 20. re- ported the Joint Chiefs of Staff had determined that 5,000 M-1 rifles and 5 million rounds of ammunition could be made available to Saudi Arabia without seriously affecting the mobilization capability of United States forces. The closing para- graph of the letter read: "I suggest, therefore, that if you should determine that as a last resort tangible evidence of US intent is required in connection with negotiations for the extension of the Dhahran Base Agreement, and if definite indication of favorable action is obtained from appropriate congressional leaders as to the proposed reimbursable aid program for Saudi Arabia, we collaborate in recommending that the President authorize the transfer." (711.56386A/4-2050)

The proposal to send such a shipment had previously been made by Gen. J. Lawton Collins, Chief of Staff of the United States Army, during his visit to Saudi Arabia on an inspection trip to the Middle East. See his telegram of April 3, p. 1154.

1130

SAUDI ARABIA 1131

token or temporary assistance which might be provided it is suggested that reference might be made to the suggestions contained in telegram No. 83, of February 14, 19501 to the Department of State from the American Embassy at Jidda. A copy of this message is enclosed.

Sincerely yours, RAYMOND A. HArE

'Ante, p. 1126.

611.86A/3-1950

Memoranduwi of Conversation 1

SECRET [JIDDA,] March 19, 1950. Subject: United States-Saudi Arabian Relations Participants: HRH, Prince Feisal, Viceroy of the Hejaz and For-

eign Minister Shaikh Abdullah Sulaiman, Minister of Finance Shaikh Yusuf Yassin, Deputy Foreign Minister Najib Bey Salha, Assistant Deputy Minister of

Finance Ambassador J. Rives Childs The Honorable George C. McGhee, Assistant Secretary

for NEA Heyward G. Hill, Counsellor of Embassy, Jidda William D. Brewer, Third Secretary of Embassy,

Jidda Mohammed Effendi Massoud, Embassy Arab Secretary

The above group met in the Saudi Arabian Ministry of Foreign Affairs on March 19, 1950, to discuss current problems of interest to

IA notation on the last page of the source text read "Drafted at American Embassy, Jidda. Copied in NEA." Although no drafter is indicated, It was pos- sibly drafted by McGhee. Despatch 153, April 8, from Jidda, reported "An ex- tended account of this conversation was made and taken back to the United States by Mr. McGhee." The despatch was an account of McGhee's March 18 to March 24 visit to Saudi Arabia. Enclosed with it were a translation of a Saudi Arabian newspaper account of McGhee's arrival, and the memorandum of con- versations of March 22-23, infra. (110.15MC/4-350)

Despatch 50, April 10, from Dhahran, contains additional information on his trip. McGhee was in Dhahran from March 20 to March 22 and March 24 and 25. On March 25 he made a brief trip to some oil well sites and then, with Ambassa- dor Childs and Consul General Parker T. Hart from Dhahran, flew to Kuwait. There they were received by Shaikh Abduliah As-Salim Al Subah in a formal visit at the palace. McGhee returned to the United States on a commercial flight from Basra, Iraq, on March 26. (786A.00/4-1050)

A summary of the source text was prepared in the Department of State on April 7 and sent by McGhee to the Secretary of State on April 11 (Secretary's memoranda, lot 53D444). Lot 53D444 is a comprehensive chronological collection of the Secretary of State's memoranda and memoranda of conversation for the years 1947-1953, as maintained by the Executive Secretariat of the Department of State.

FOREIGN RELATIONS, 1950, VOLUME V

the two governments. After greetings and expressions of welcome were exchanged, His Royal I-Iighness stated that this personal visit by Mr. McGhee would help greatly in developing understanding be- tween the two countries. He stated that any visit by an American official always increased this understanding and expressed the wish that more Americans could visit Saudi Arabia.

Mr. McGhee stated that he would like to summarize each impor- tant problem facing our two countries as it appears to us, and then ask His Royal Highness to comment as well as to raise any questions he might have, and discuss them fully.

The relationship between the two countries, Mr. McGhee said, is unique among all our international relationships. There is no country in this section of the world in which we have this particular type of relationship. Although it is not possible to view relations between countries as between individuals, nevertheless our relationship is stronger than could be defined by formal contracts or treaties, since it arises from the genuine personal friendships between our respective peoples.

Twice in modern history our country has come to the assistance of Europe despite the absence of a formal treaty, because of the ties be- tween our people and the people of Europe. Our relations with Saudi Arabia are founded on strong human relationships, personal relation- ships between our leaders, as exemplified by the meeting of His Majesty and our late President,2 together with frequent interchanges among our peoples. All of our businessmen and oil men and govern- ment officials find that they may easily conduct their business with Saudi Arabs on the basis of human understanding. This is the under- lying force which joins our two countries together and transcends all treaty arrangements.

i addition, as one analyzes it, the United States has an extremely strong interest in the American investment in petroleum in Saudi Arabia. This is an interest which is vitally important to the security of the United States and to the world.

American interests in oil in this part of the world, which is the greatest reservoir in the world, is largely confined to Saudi Arabia. American oil companies have a small interest in Iraq and Kuwait but the major interests that American companies have in the Middle East is in Saudi Arabia. This fact alone, if it were not for other factors, would give to our country a very great responsibility and interest in Saudi Arabia and its right to be a free and independent state.

2 See documentation on the meeting between President Roosevelt, King Farouk of Egypt, Emperor Halle Selassie of Ethiopia, and King Saud, in Egypt, on Febru- ary 13-14, 1945, in Foreign Relations, 1945, vol. vxu, pp. 1 ff.

See documentation on the participation by the United States in the develop- ment of the petroleum resources of the Near East, pp. 9 ff.

1.132

Mr. McGhee said that he felt that since this relationship exists it is the obligation of the United States to understand the problems of Saudi Arabia and, as a friend, to assist her within the limits of Ameri- can capabilities in facing these problems. Cognizance must be taken of what Saudi Arabia considers her problems, and not only what the United States considers are Saudi Arabian problems, because Saudi Arabia knows better than the United States just what these are.

It is hoped that Saudi Arabia will correspondingly judge the effec- tiveness of the assistance which the United States gives, taking into consideration the fact that the United States has very large world responsibilities. Only the United States, among the independent coun- tries of the world, is in a position at the present time to take the lead in facing the grave dangers which exist in the world. This means, not only for the benefit of ourselves but for the benefit of all free nations in the world, it is necessary that the United States render assistance to na- tions who find themselves threatened by aggression or subversion from the north.

The United States does not have unlimited resources of wealth.with which to support these grave obligations. In fact, there is an internal deficit in the American budget which imposes considerable financial difficulties. While the United States is willing and anxious to do what is possible, it is hoped that His Royal Highness and Saudi Arabia will recognize that there are always limitations to what the United States can do.

The most important thing to any nation is its security-the most important thing to the United States is its security. The United States feels that this must be uppermost in the minds of His Majesty and the people of Saudi Arabia. Security is something about which, Mr. Mc- Ghee said, he felt one must take a very broad view. One can view im- mediate security menaces or one can view long-range and possibly more dangerous security menaces.

The United States feels that the only important long-range security menace that faces the world is the obviously aggressive designs of the USSR. The United States accepted this view very reluctantly, and it hopes that history will reveal that it made every effort in the post-war period to cooperate with Russia and establish friendly relationships with her. But the United States found it impossible and discovered that they must assume a defensive attitude with respect to Russia. That is why the United States, as a normally peaceful nation, which has never waged aggressive war or spent large sums on military arma- ment, has had to devote such a large part of its budget to military purposes.

Even though it is alien to American history and nature to provide arms to other nations, the United States has, in cases where it was felt

1133SAUDI ARABIA

FOREIGN RELATIONS, 1950, VOLUME V

necessary to preserve the independence of nations which were being threatened by Russian aggression given large scale military assistance. First to Greece, when the Greek Government asked the United States to protect them from guerrillas, the United States gave wholesale assistance. Also, in the case of Turkey, the United States gave military assistance.4

Now the United States is prominent in the military assistance being given to the Western European countries, something provided for by the North Atlantic Treaty which was negotiated between the United States and the North Atlantic countries and which reflects the Ameri- can conclusion that the security of the North Atlantic area is most vital from the standpoint both of the United States security and the security of the world. The security of this area is necessary in order to protect its great industrial potential for the nations of the world. This is not only important to Saudi Arabia and the United States, but to all free nations who desire protection from Russian aggression. The Depart- ment of State feels that in pursuing this program the United States is giving assistance to Saudi Arabia and each country in the world which wants to remain free and independent.

Since the resources which the United States has for making com- mitnents are limited, of necessity the United States has made com- mitments where it was thought the most urgent situation existed from the standpoint of world security.

Now Saudi Arabia is not, fortunately, menaced by Russian aggres- sion. Saudi Arabia has no common boundaries with Russia and fortu- nately has no internal Communist problem. The United States under- stands that Saudi Arabia would be a very valuable target in the event of a shooting war and in that event Saudi Arabia would face the prob- lem of its owif, defense. The United States understands that Saudi Arabia cannot ignore her security problem from the standpoint of Russia itself.

The United States also understands fully the apprehension of Saudi Arabia with respect to her neighbors, the Hashemite Kingdoms,5 and irrespective of American conclusions as to whether or not Saudi Arabia is menaced by the Hashemites, the fact that Saudi Arabia considers herself menaced is taken into consideration. This is a question to which the Department of State has devoted much thought. It is troubling Saudi Arabia and should be analyzed by the United States to see if there is any real basis for apprehension on the part of Saudi Arabia.

Mr. McGhee said that he, himself, had had special discussions with the British Foreign Office on this problem as well as with United

' See documentation ou United States economic and military aid to Greece and Turkey, Foreign Relations, 1947, vol. v, pp. 1 ff. 5 Jordan and Iraq.

1134

SAUDI ARABIA

States representatives from all over the Near Eastern countries at the Istanbul Conference. The representatives in the countries concerned do not feel that there are aggressive designs against Saudi Arabia. How- ever, Saudi Arabia knows its neighbors much better than the United States does and the latter does not want to attempt to tell Saudi Arabia in an authoritative way what their ultimate designs may be.

The situation was analyzed, however, in this way, a way which Mr. McGhee said he thought should be reassuring to the government of Saudi Arabia. In the first place, there appears to be little basis for a community of interest in action on the part of the Hashemite coun- tries. In the case of both countries, they have special treaty arrange- ments with the United Kingdom. In each case the United Kingdom has certain specific rights with respect to their own internal forces and with respect to the base rights in their areas. In both cases the countries are dependent upon the United Kingdom for the supply of military equipment, personnel, and in many cases military leaders. In our judgment the British are fully capable of restraining any action of aggression on the part of either of the two countries.

The British have assured us in a most sincere way that they have every desire to prevent such aggressive action and share the interest of the United 'States that Saudi Arabia be not menaced and be per- mitted to maintain its independence and integrity. If one considers the close relationship that exists between the British and the United States, Mr. McGhee said that he could assure His Royal Highness in a cate- gorical way that it would not be possible in the light of these factors that these countries undertake any independent aggressive action against Saudi Arabia.

Mr. McGhee said he fully understood that despite these questions Saudi Arabia is entitled to a security force. It is the conclusion of the United States that the only ultimate security any nation has is in its internal political and economic strength, and it is indeed fortunate, in a sense, that nations who are not in a position to bear a large portion of world responsibilities can devote a large portion of their energy to- ward internal economic development.

His Royal Highness is fully aware of the succession of events which have led the United States to send a group headed by General O'Keefe to investigate the problems of Saudi Arabia. The United States is very pleased indeed, that Saudi Arabia requested such an investigation and very pleased also that it was possible to provide such a qualified group to study these security needs. The Department understands that their recommendations have been studied by Saudi Arabia and that Saudia Arabia is in agreement with the general conclusions and recommendations.

538-1SS-78- 73

1135

FOREIGN RELATIONS, 1950, VOLUME V

As the President has written to His Majesty in a letter which Mr. McGhee said he would deliver to him in Riyadh 6 the Joint Chiefs of Staff, which is the highest military tribunal in the United States, is presently studying General O'Keefe's report. A most careful and au- thoritative study is being given to this report to determine whether or not the recommendations are the best possible for Saudi Arabia in the light of her military situation and the equipment available.

After the Joint Chiefs of Staff have completed their report it will be studied by the Department of State and what is finally agreed upon by the President will become the basis upon which the United States will assist Saudi Arabia. At the appropriate time the Executive of our Government will seek from the Congress what additional authority if any is needed in order to meet the requirements of the recommenda- tions of the O'Keefe report. As His Royal Highness understands fully, the United States is a democracy and the Executive sometimes has difficulty in obtaining its requests from the Congress but the Ex- ecutive will press this point with all possible vigor when the recom- mendations of the O'Keefe report have finally been agreed upon.

When the United States has this authority, the Department of State looks forward to renewing discussions with the Saudi Arabian Gov- ernment, looking toward negotiations for a long-range arrangement for the Dhahran Air Base which, as the Saudi Arabian Government knows, is the desire of the United States be concluded. The United States still attaches the greatest importance to the utilization of this air base both from the standpoint of United States and Saudi Arabian security interests and the security interests of all the free nations of the world. The United States also has every desire that Saudi Arabia feel that it has in the United States a strong and ready friend who will assist it in time of adversity, and that although the United States does not feel that Saudi Arabia is at present menaced, if at any time it is menaced by aggressive action or subversive activities from any neighboring power, the United States Government will take most definite action.

Mr. McGhee then said that he thought it might be appropriate before he talked any further to inquire whether His Royal Highness had any comments to make with respect to the general question of security, although he recognized that no conclusions would be considered final before they met with His Majesty's approval.

His Royal Highness Prince Feisal then replied that he had no doubt that everyone who is sincere in his feelings toward Saudi Arabia has been well-pleased to see the friendship existing between the two coun- tries so greatly strengthened. He said that he was, and remained, one

'McGhee met with the King on March 22 and 23; see the memorandum of conversations, infra.

1136

SAUDI ARABIA

of those who are so eager to see the strengthening of this friendship and he expressed the hope that, even though sometimes differences may exist in points of view, these differences will not have an adverse effect on the friendly relationships that exist between the two countries.

As far as security and defense were concerned, you have been ac- quainted with the report which was submitted by General O'Keefe's Survey Mission.7 Saudi Arabia considers the contents of that report a bare minimum. In other words, 1-is Royal H-ighness stated, "We need more but not less than that".

His Royal Highness went on to point out that security and defense can be divided into several stages, namely, internal stability, complete security from any aggression or menace from a neighboring country, and lastly, a menace which is menacing the whole world.

Saudi Arabia must make preparations to face this aggression. The Saudi Arabian Government hopes that the United States will under- stand that the situation in Saudi Arabia differs from the situation in the United States or England or any other country in Europe. For this reason Saudi Arabia states that it must keep certain methods of preserving security which differ from other schemes used in the United States or Europe or in any foreign nation.

If Saudi Arabia is going to form a force just to maintain internal stability, His Royal Highness asked Mr. McGhee if he had any idea of what that would involve. Looking at the recent past, the police force is not the prime safety factor for safety and peace in Saudi Arabia. The security and peace prevailing all over Saudi Arabia is not the result of its police force, but the result of the wise system of His Majesty in governing Saudi Arabia.

Everyone is talking, building up a campaign against His Majesty, saying that he is an absolute monarch spending all his money for nothing, neglecting all important projects. His Royal Highness stated that he was sure that His Majesty has the final authority in issuing any instructions, but while it may be thought that His Majesty is spending money for his own personal luxurious life, or spending it to augment his own personal wealth, on the contrary, he is spending that money in gifts to those who, if they had no money to feed them- selves, would be a threat to internal stability. If the history of this peninsula is reviewed, it will be found that most of the tribes did nothing to guard the security of this country. But since His Majesty has been in power it is apparent that he is spending that money in certain areas so that those places would keep quiet and not stir up the whole situation and menace the security of this whole country.

'Ante, p. 1112.

1137

FOREIGN RELATIONS, 1950, VOLUME V

It may be that certain of His Majesty's employees may make mis- takes, but human beings are prone to make mistakes. Nevertheless, the basic principle is there. If it is desired to consider the revenue of Saudi Arabia, which also the world has just made a big fuss about, in any other country it is not a great deal. The Saudi Arabian Government does not deny that it has certain income which would be sufficient to feed its people, but if it is desired to use this income to build a strong army and spend it on government projects, and not to make a luxurious life but merely to improve transportation and communications in Arabia along modern lines, Saudi Arabia's funds would never be suffi- cient to cover all these projects. For, in spite of the fact that we do Ihave some revenue, this alone is not sufficient for us at once to step -forth and take our place among the fully developed nations of the world.

His Royal Highness stated that he desired to give Mr. McGhee certain ideas on this point and that he would now return to the main topic.

He said that if this question of the neighboring menace had been left to Saudi Arabia and its neighbors alone to settle without inter- ference on the part of foreign powers, Saudi Arabia could have settled it very easily. Saudi Arabia's neighbors are supported by a great for- eign power and though that foreign power has no intention of threaten- ing Saudi Arabia, yet the threat comes indirectly through their sup- port of these neighbors. While these neighbors have been supported and have been given armaments, Saudi Arabia has been deprived of them. These neighbors have been offered a lot of arms and have been given support along lines of military education and training for their personnel while Saudi Arabia, who should it seek similar assistance, would have difficult obstacles put in its path. Despite the current high prices for arms, which Saudi Arabia cannot meet, Saudi Arabia would like to get as much in the way of military assistance as its neighbors are getting.

In addition to that, these neighbors are manufacturing a campaign of propaganda against Saudi Arabia, not only in the adjacent coun- tries, but abroad as well. For Saudi Arabian prestige, it would be better that this point not be considered by it. Saudi Arabia has no desire to grant any aid when people are desirous of maintaining the stability of their area, but Saudi Arabia hopes that its friends will try to stop or limit such propaganda which Saudi Arabia does not consider so much a real menace and threat as something to be dis- gusted about.

Saudi Arabia would prefer that this area be left alone to itself, but this is impossible and the interference of foreign powers seems rather the type of action which serves to justify this whole situation. It is

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not sufficient to say that Saudi Arabia is not directly threatened by its neighbors at the moment, for nothing is far away. Though it is not immediately threatened, the United States is taking certain meas- fres to insure its security against Russia. It should not be necessary for Saudi Arabia to have to wait until the bell of danger rings and then make its cries for help heard. Saudi Arabia considers that it has a right to ask help of its friends. When Saudi Arabia approaches the United States it is claiming the right of friendship.

The United States has certain interests here, as Mr. McGhee says. Saudi Arabia cannot deny that the United States is a democracy with certain difficulties with Congress in the matter of obtaining appro- priations, but if the President and the Government and the Depart- ment of State, who are well acquainted with the situation all over the world, felt there was a menace to the interests of the United States, American public opinion could be molded, if not for the sake of Ibn Saud, for the sake of the interests of the United States and Saudi Arabia. Mr. Childs knows, said His Royal Highness, that he is always frank and never restricts himself to the niceties of diplomatic protocol.

As is known, Saudi Arabia has turned away from the United King- dom and placed more of its interests in the hands of the United States Government. However, Saudi Arabia continues to maintain very friendly relationships with the British and will continue to maintain friendly relations with them. Formerly, the British treated Saudi Arabia very well, but recently they have, in view of certain interests, tried to maintain these interests which have become a menace to Saudi Arabia.

In spite of this action on the part of the British, Saudi Arabia has continued to maintain friendly relations with them and it hopes that these friendly relationships will continue. However, to maintain friendly relations with the British does not prevent Saudi Arabia from looking out for its security and preparing its defenses. Saudi Arabia's interests are more closely related to those of the United States now, and because of this sharing of interests Saudi Arabia feels that the United States Government should be more willing to help support Saudi Arabia.

His Royal Highness said that Saudi Arabia had many problems, involving financial and economic questions, communications, public works, cultural development, and health. He said he was giving Mr. McGhee a complete picture of Saudi Arabia's situation so that he would understand the situation well. What is left unclear may be completed and cleared up by Mr. Childs.

Mr. McGhee then stated that he fully appreciated the factors which His Royal Highness had mentioned and that Saudi Arabia does have the need for security. He said that the United States has every desire

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to assist in meeting this need and particularly, out of this special friendship which His Royal Highness has been kind enough to refer to, the United States feels that it is incumbent upon it to assist Saudi Arabia in providing these forces, and that, of course, is why Genetal O'Keefe made his survey and why we are giving such earnest con- sideration to his report.

Concerning economic development, this is something in which the United States Government has taken increased interest in connection with the statements of our President in his inaugural address concern- ing Point Four. It is the desire of the United States Government to help Saudi Arabia in its development program which His Majesty has undertaken and is pursuing so vigorously. It is thought that the United States can assist Saudi Arabia in two ways.

First, Mr. McGhee said that he was very pleased that Saudi Arabia has put forth a request for some money to assist in developing very specific projects. Although the request had been sent to the Department since he left Washington, he had seen a statement of it and the projects seemed to be sound. As His Royal Highness knows, the Export-Import Bank granted a loan at one time to Saudi Arabia. Mr. McGhee said that although final decision on the granting of the loan would be made by the Bank, he felt that the Bank would consider favorably these new requests and he stated that he would discuss this matter with the Bank when he returned to Washington. Saudi Arabia can be sure that f rom every political standpoint, it is the earnest desire of the United States that these projects be carried out.

The other way in which the United States can be of assistance is through the President's Point Four technical assistance program. In the requests that have been made to the Congress, there is a request for a considerable sum for technical assistance to Saudi Arabia. This sum is not large in comparison with the cost of the projects, but the amounts which can be spent on technical assistance are limited. It will make it possible, if Congress acts favorably on this request, for the United States to send to Saudi Arabia American technicians who can come and assist in solving the basic problems which Saudi Arabia must face before it can effect this development.

These technicians will, of course, be provided on a grant basis. The types of technicians which are required depends upon the wishes of the Saudi Arabian Government, but, from Ambassador Childs' discus- sion with this Government and United States discussions with Saudi Arabian officials, it would appear that among the most important problems that Saudi Arabia faces are the problems of ground water exploitation, the improvement of agricultural methods, improvement of transportation, and technical assistance in various fields such as finance and administration.

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As soon as authority is received from the Congress, the United States Government will enter into detailed discussions with the Saudi Arabian Government on their desires. The United States Government feels that technical assistance and the loans from the Export-Import Bank, augmented by private investment, will assist Saudi Arabia in its development. The United States on its side is gratified that Ameri- can investors, both oilmen .and others, have chosen to come here to work with the Saudi Arabian Government and that the Saudi Arabian Government has cooperated with them so well. One small but typical example is the recent negotiations for a cement plant in which the Export-Import Bank has assisted. Part of the Point Four Program is to provide legislation which will induce the participation of private investors through reducing some of the risk of foreign private invest- ments. The United States Government hopes that in the future more American business men will come here, if the Saudi Arabian Govern- ment so desires.

In this connection, it is the desire of the United States Government to negotiate with the Saudi Arabian Government a Treaty of Friend- ship, Commerce and Navigation which will serve as a basis here on which business may be conducted. The treaty would, of course, cor- respond to the wishes of His Majesty. It need not be a complicated treaty. The United States Government feels that the negotiation of such a treaty would symbolize the close and friendly relations between the two countries.

Prince Feisal then stated that he was pleased with such assurances that the United States will assist Saudi Arabia in the economic field in the ways Mr. McGhee had mentioned. Since His Majesty will ulti- mately determine the final points of such aid it was not his wish to go too deeply into discussion of the economic questions. Assurances from Mr. McGhee that the United States Government is ready to help Saudi Arabia with this is sufficient.

Mr. McGhee replied that there were two special questions which he would also like to discuss. One was the question of the dispute over the eastern boundaries of Saudi Arabia." The United States Govern- ment recognizes, of course, that this is Saudi Arabia's problem and a problem of great concern to Saudi Arabia. Since, however, the dis- pute is largely with the British, and the British and Saudi Arabia are both good friends of the United States, the United States Government is reluctant to see them in a dispute.

8 For documentation on boundary disputes between Saudi Arabia and the Sheikhdoms of the Persian Gulf in special treaty relations with the United King- dom, see Foreign Relation8, 1949, vol. vi, pp. 91 ff.

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FOREIGN RELATIONS, 1950, VOLUME V

As a good friend to both, the United States Government will do all it can to assist in reaching a settlement, since it would help greatly from the standpoint of security and the development of the country for this question to be settled. Mr. McGhee said that he did not feel that it was appropriate for the United States to inject itself directly into the question, since it is a problem for the Saudi Arabian Govern- ment and the British. The two parties should be able to devise a method of working out the problem.

The United States Government was pleased that the Saudi Arabian Government put forth the suggestion of creating a fact-finding coin- mission, since we felt that this was a constructive step. If a fact-finding commission could be created by mutual agreement, the United States Government feels a most useful step would have been taken in nar- rowing the existing area of disagreement. Once this area of disagree- ment has been determined, the question can be narrowed even further by straight diplomatic negotiations. Any remaining problems can pos- sibly then be dealt with by means of arbitration. Mr. McGhee said that he understood that this was the suggestion of the Saudi Arabian Government and that he would like to offer the good offices of the United States Government if this could assist in any way the reaching of an understanding with the British.

Shaikh Yusuf Yassin then stated that most of the difficulties involve disputes over some islands in the Persian Gulf. The Saudi Arabian Government is perfectly sure that these islands are part of this coun- try, and they belong to 'Saudi Arabia, and no neighboring country has any right whatsoever to take them. Saudi Arabia has given a con- cession to Aramco, which is represented by the American Government and the Saudi Arabian Government should have help from the Ameri- can Government, which is Aramco's government.

More than that, as has been stated, Saudi Arabia has on several oc- casions had difficulties with its neighbors but has always managed to settle these without interference of a foreign power.

Prince Feisal said that the Saudi Arabian Government had written to the British Government with reference to this, and the British had no proof to the claim. From the Saudi Arabian Government's com- munications, Mr. McGhee could come to the conclusion that the British had no proof and no right to these islands. His Royal Highness said that he would like to invite Mr. McGhee's attention to the fact that Saudi Arabia does not want to create any differences with the British or with neighboring countries. Saudi Arabia has been silent for many years and they have taken the initiative.

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Aramco told the Saudi Arabian Government that British agents had stopped them from continuing exploration work. It was requested that all parties be withdrawn pending the working out of a settlement.

As an example of the validity of the British claims, His Royal Highness said he would mention that many years ago Britain re- quested through the Saudi Arabian Government that India be per- mitted to establish a lighthouse on one of the islands, and the British stated that that did not affect sovereignty over those islands, and now they present their claims.

Mr. McGhee stated that he felt sure that Saudi Arabia had a basis for its claims. Although the United States does not feel that it can decide this for itself, it is sure that justice will be given to the claims of Saudi Arabia. The United States thinks that the Saudi Arabian Government has been very patient in this matter. If the United States can assist in any way in setting up procedures to evaluate these claims and arrange a settlement on a fair basis, it will be very glad to do so.

Prince Feisal replied that the Saudi Arabian Government had sug- gested procedures but that the British have not as yet sent a reply.

Regarding the other matter, Mr. McGhee said that he would like to discuss briefly the shortage of dollars, and its effect on the sale of Saudi Arabian oil on the world market. He said that, as His Royal Highness knew, there had been a tendency on the part of the British to purchase oil from sterling sources rather than from dollar sources and, while in some cases the decision has been based on purely legiti- mate necessity for conserving foreign exchange, the United States Government feels that the decision, in many cases, has been based on actual discrimination against Saudi Arabian oil.

It is, of course, in the interest of both countries that the oil produc- tion of Saudi Arabia be maintained at its present high level. This is, of course, very important to the Saudi Arabian Government since oil royalties are its principle source of income. When the United States Government recently discussed the matter with the British, we pro- tested to them in very strong terms the action they have taken. The question is currently under discussion with the British with the end in view of protecting Saudi Arabian sales in the world market. Vari- ous compromise proposals have been discussed, which involve receipt of sterling by the American companies for a part of the proceeds from the oil. Mr. McGhep said that he would like to reassure His Royal Highness that the United States Government has the interest of Saudi Arabia fully at heart in this question and will press the matter to the utmost. Mr. McGhee said that he had as his personal assistant in

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these negotiations Mr. Funkhouser 9 formerly Petroleum Attach6 in Cairo, who is known to the Saudi Arabian Government.

Another question concerns the possible union of Iraq and Syria.1° The position of the United States Government with respect to the proposed union is very clear. This position was stated to the countries concerned, to the British, and to all interested governments, namely, that although we would not oppose union which came about as a result of the freely expressed will of the people, that we would oppose any union which was the result of outside force or which was not freely accepted by the people. At the same time the United States expressed great concern over the actions or reported actions taking place, because the United States saw no evidence that the impetus toward union arose from a genuine desire on the part of the people concerned. The United States Government knows, of course, fully well the position of the Saudi Arabian Government in respect to this question, and it was largely influenced by the position the Saudi Arabian Government took.

The United States Government is gratified that the Saudi Arabian Government has seen fit to extend aid to Syria, 1 and feels that this is a generous and constructive action which will help Syria through grave difficulties. It is the desire of the United States that Syria emerge as a strong independent democracy to take its place among the nations of the Near East and that it acquire some political and economic stability which it badly needs. The United States Government hopes that Saudi Arabia through its great influence on Syria will influence Syria toward this objective.

The United States Government feels that Syria has a great op- portunity in its participation in the program which has been recom- mended by Mr. Clapp,'2 and for which some $54,000,000 will be supplied by the United Nations, to be available for Syria (and for other countries immediately adjacent) not only to assist in actually feeding the refugees but also to be used in benefiting Syria. This assist- ance implies no political obligations on the part of Syria, but the United States Government feels it would be one of genuine benefit to Syria.

'Richard E. Funkhouser of the Office of African and Near Eastern Affairs. "For documentation on this topic, see Foreign Relations, 1949, vol. vi, pp. 180 ff. "In telegram 63, February 2, from Jidda, not printed, the Ambassador re-

ported the Deputy Finance Minister of Saudi Arabia informed him that the Saudi Arabian Government signed an agreement on January 31 to loan Syria $6 million, without interest. The loan was to be repaid in Syrian products over the 4-year period from 1955-1958. (883.10/2-250)

"The first interim report of the United Nations Economic Survey Mission for the Middle East, whose chairman was Gordon R. Clapp, was signed on Novem- ber 6, 1949; see editorial note, Foreign Relations, 1949, vol. vi, p. 1472.

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Mr. McGhee said that he had presented to Congress the request for some $27,000,000 for this program, and it was his earnest desire that Syria should participate in this program. All these funds are for the benefit of the Arab states and for their economic development, as was clearly stated in the Clapp Report.

Prince Feisal then commented that, concerning the question of Syria-Iraq union, as is known all Saudi Arabia's activities are for the benefit of the independence of Syria. One may hear that something is desired by the people when in reality it is not. All nations are not like the United States in stating what they would like, with full freedom. For example, in Bulgaria, Rumania, and Czechoslovakia, it will be said following the elections that the officials have actually been elected while in reality they have not.

Mr. McGhee replied that he fully concurred that there is no evidence at present which would lead one to believe that this is true of the nation of Syria. The United States Government does not have evidence that the people of the nations involved want union.

Prince Feisal stated that this is really what is worrying Saudi Arabia, namely that there shall be no action which will be said to represent the desire of the nation but which may not be so. Saudi Arabia was always helpful to the Syrians when the previous President was in power.

As regards Mr. Clapp's report, there is one more point: when the Arab refugees take residence in the country where they are, there will not be anyone left to claim residence in the home country of Palestine.

Mr. McGhee replied by pointing out that the Clapp Report does not prejudice a political settlement. The Report rightly addressed itself to two problems which must now be faced; namely, how the refugees will live and eat from day to day, and how those countries affected by hostilities can develop economically.

His Royal Highness replied that Israel did not come into line in the case of the General Assembly resolution, but in the case of the earlier resolutions the Arab states were forced to come into line.

Mr. McGhee stated that the United States had pressed Israel with every means available to make Israel come into line. Certain notes which the United States Government had sent to Israel have been made public and are probably known by the Saudi Arabian Govern- ment. He wished to assure His Royal Highness that it is a great source of regret to the United States that Israel has not carried out the resolution.

Prince Feisal stated that Saudi Arabia would not like to see America either give Israel another loan or give financial assistance in any way. Saudi Arabia would appreciate any assistance which the United States could render to enforce the resolutions of the United Nations.

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611.86A/3-2350

Memorandum of Conver8ations, by the Ambassador in Saudi Arabia (Cklds)

'SECRET [JmDA,] March 23, 1950. Subject: United States-Saudi Arabian Relations Participants: H. M. King Abdul Aziz ibn Abdurrahman al Faisal al

Saud H. R. H. Amir Saud ibn Abdul Aziz ibn Abdurrahman

al Saud, Viceroy of Nejd H. E. Shaikh Yusuf Yassin, Minister of State H. E. Fuad Hamza, Adviser to the King J. Rives Childs, American Ambassador George C. McGhee, Assistant Secretary for NEA

Assistant Secretary of State McGhee and I arrived shortly after 9: 00 o'clock in Riyadh on March 22, 1950, and after being conducted to our rooms in the new palace, were received by His Majesty during which the usual courtesies were exchanged. His Majesty expressed his great pleasure at receiving Mr. McGhee and having the oppor- tunity to exchange views with him during the course of his visit.

We later saw Shaikh Yusuf Yassin at which time Mr. McGhee discussed the influence of SA in the Arab League in the matter of facilitating the introduction of stability in the M.E. (See Dhahran Telegram No. 53, dated March 25, 1950.2) Shaikh Yusuf agreed that although SA was not as wealthy or powerful as other Arab states, nevertheless, in the Arab League meetings the representative of SA always spoke last. Of the two points raised Shaikh Yusuf appeared to indicate that he would use his influence in the Arab League to urge the states concerned to cooperate in the carrying out of the Clapp program and accepted the assurances that no political commitment was involved. His response, however, was entirely negative to any suggestion of encouraging or even permitting any country to make peace or establish any normal relations with Israel.

In the afternoon Mr. McGhee and I were received again by the King at which time Mr. McGhee reviewed in summary manner the problem of meeting SA's security requirements. The presentation was a sum- mary of the verbal presentation made by Mr. McGhee in Jidda to Prince Faisal.

IA summary of the source text was prepared in the Department of State on April 10, and Acting Secretary James Webb transmitted it to the President on May 9 (Secretary's memoranda, lot 53D444).

2Presumably this refers to telegram 54, March 25, from Dhahran. The telegram reported a conversation between McGhee and Yassin on March 22 on Arab-Israeli relations and is printed, p. 816.

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SAUDI ARABIA

Mr. McGhee in concluding said that if the independence or integrity of SA were threatened, the United States would take most immediate action. The King would understand, however, that in the light of the complexities of the situation which might exist at any future time, that it was not possible to state in precise terms what action might be taken.

His Majesty referred at some length to his problem with the Hashemites with which he was obviously preoccupied. He said the two Hashemite rulers had been imposed on their respective countries and had never been accepted wholeheartedly by the people. Their military power was entirely derived from British support, without which they would represent no threat. SA on the other hand had no such outside support. . His Majesty said that he had at one time offered the oil concession of SA to the British but they had refused it, although he himself was well aware, on the basis of information given him by the Turks before the first world war which they had obtained from the Germans, that SA was potentially one of the richest countries in the world so far. as oil was concerned. Although the British had been given first refusal of the oil, they had always resented the fact that the conces- sion had been given to America and his difficulties with the British had begun from that time. Accordingly, SA had every right to expect that we would approach its needs in security requirements with sympathy.

The King referred to his boundary difficulties and described the British position as very unreasonable.

The King said that the British were a people of "but". They made statements and gave you assurances but always at the end "but". His Majesty said that he would like for us to meet with Shaikh Yusuf Yassin and Fuad Bey Hamza at which time the discussions could be continued and amplified.

In the evening there was a 'State banquet. Dinner was served in complete western style, except for the King himself-a very recent innovation at Riyadh.

On request from Ambassador Childs His Majesty recounted the capture of Riyadh, which represented the first stage of the establish- ment of the King's power in the Arabian peninsula. It is given here as being of historical interest. Mr. McGhee inquired of His Majesty if any Arab rulers had previously controlled the peninsula as His Majesty does now. His Majesty replied that a member of his family, coincidentally with the same name, had established such control over the Arabian peninsula some 250 years ago. This constituted the only previous union of SA. Subsequently, his family had ruled only over

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minor villages. He was assisted in his conquest of Riyadh by some 40 followers. They proceeded to the vicinity of Riyadh on camels from which they descended and walked some four hours to Riyadh arriving after dusk. The King knocked at the door of a house, which was at the edge of the village and which constituted a part of its outer forti- fications, and was received by a woman who refused his admittance. He advised her, however, that he was a servant of the Amir and that if she did not admit him he would see that her husband would be killed by the Amir, whereupon she acceded. When he entered the house she immediately recognized him since he was apparently well known, but when his identity was known to the other members of her family they acclaimed him and agreed to support him. In order to prevent the woman from disclosing his presence he locked her in her room and he and his followers proceeded over rooftops to an adjoining house where he found a man sleeping in bed with his wife. He also locked them in a room so that they would not give an alarm. They then proceeded to the home of one of the Amir's wives whom they found sleeping with her sister. She, when awakened, advised that the Amir was in his palace but warned him that he could not overcome the Amir, whereupon he locked them up. At this juncture it was still a long time before morning so he and his followers prepared coffee and slept until dawn. At dawn, as was his custom, the Amir emerged from the palace which was well defended, along with some seven of his guards. The gate to the palace was opened and they came into the open court-yard in front. Ibn Saud and his followers, who had been lying in wait, attacked them and the seven guards fled back into the palace with the Amir behind. Tbn Saud grabbed the Amir from behind and arrested his flight. The Amir in turn kicked Ibn Saud and pushed him down, whereupon Abdullah Saud bin Jelui hurled a spear ai the Amir and killed him. The group then attacked the palace which was defended by some 200 soldiers and took it with the loss of only two killed and 14 wounded after inflicting the loss of 15 on the defenders. Within two days some 4,000 men had rallied to his support. Ibn Saud said that the Riyadh Conquest was a difficult one, especially since it was the first, but not the most difficult one. On two occasions all of his followers, aggregating some 800 or 900 people were killed, and he alone escaped to recruit more support.

His Majesty said the best account of the Capture of Riyadh was that given in Rihani's book.

Mr. McGhee questioned His Majesty as to any conversation he might have had with the King of Afghanistan who had departed several days before, after visiting His Majesty, with respect to the dispute with Pakistan over the Northwest territory3 His Majesty said

I For documentation on this topic, see pp. 1446 ff.

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SAUDI ARABIA

he had spoken with the King urging upon him that he make every effort to reach agreement with Pakistan over the issues between them involving the Pushtoon tribes of the Northwest territory. His Majesty added that he would make every effort to do so. Mr.'McGhee stated to His Majesty that it was the frank view of our Government after a detailed investigation that the situation among the tribes did not appear to justify the strong position taken by the Afghanistan Govern- ment. In fact, it appeared that the Afghanistan Government itself was, to a considerable extent, responsible for the unrest among the tribes. The King indicated that this was his own conclusion in the matter and promised that he would renew his attempt to reconcile the difference. Mr. McGhee pointed out the difficulties of creation of an independent state of Pushtoonistan even if, as the Afghanis allege, this was the desire of the tribes. He particularly noted the fact that both the British and Pakistanis had found it necessary to subsidize the tribes and that they could not possibly develop trade to support them- selves in an independent state. The King appeared to agree with this conclusion. In response to a passing remark from Mr. McGhee about the relations between SA and Ethiopia, the King said SA had friendly but never close relations with Ethiopia; did not, in fact, now have a representative in Ethiopia, although it did have one at one time. He had, he considered, close relations-with Pakistan.

His Majesty complained that European-style dinners were too long drawn out to suit him.

After dinner Fuad Bey Hamza and Shaikh Yusuf Yassin came to our palace for a further discussion. In the course of an extended con- versation, Fuad Bey, who acted as Arab spokesman, set forth at con- siderable length the desire of His Majesty for the closest possible treaty relations with the United States in the form preferably of an alliance which would assure SA of its security.

SA needed to be assured that America had more than friendship for SA, that it had vital interests, since American support would flow from such interest. He questioned whether or not Americans have sufficient incentive to protect SA's oil interests and those of American companies in SA; since there are adjoining countries such as Kuwait and Bahrein where American companies also have interests. He was assured that America did consider they had vital interest in SA both from the standpoint of its oil interests and from the standpoint of the importance of the stability and independence of SA from a stra- tegic standpoint. He was assured that America would take all appro- priate steps to protect legitimate SA interests independently of its own commercial interests outside of SA.

It was explained that America had not traditionally entered into treaties of alliance such as those entered into by the British and others,

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but that it was believed that America's record for assisting friendly states and those wherein it had vital interests was sufficiently clear to give assurances to the Saudi's.

Mr. McGhee said that despite the fact that we could not envisage the conclusion of an old-style treaty of alliance, he thought that there were several measures open to the United States which would not only give evidence of our great desire to assist SA but which might also serve in effect the practical purposes of a treaty of alliance. These measures he summarized as (1) conclusion of a treaty of friendship, commerce and navigation 4 which might symbolize and serve as a notice to all concerned of the closeness of our relations; (2) the making available of such technicians as SA might desire under the 4-point program; (3) the making of loans such as the Eximbank loan now under dis- cussion5 and; (4) the conclusion of a long-term Dhahran Airfield Agreement which would include or follow (5) a program of military aid to carry out these recommendations if the O'Keefe report finally approved including the making of arms available on a cash reimburs- able basis and the sending of an appropriate military mission to aid in the training of SA forces. . Fuad Bey was disposed to question at first whether the granting of

a loan might be claimed as a real service inasmuch as SA could obtain loans from others. Mr. McGhee pointed out that such loans were not easily obtained these days and it seemed doubtful if a loan such as SA desired might be available from ordinary banking sources. Mr. McGhee added that he did not know of any other government which was in a position to make a loan to SA.

Fuad Bey asked whether SA might obtain today the arms it needed through commercial sources. Mr. McGhee stated that the arms avail- able through commercial channels in the United States were rather limited, but he said other common use items, such as trucks and trans- port aircraft, which would be a part of SA defense requirements would be available. Most modern purely military and used items could be obtained only by purchase from the US armed forces which required Congressional authorization. When Fuad Bey suggested that Israel had been obtaining arms in the United States, it was pointed out that the arms which Israel had obtained were those limited quantities available through ordinary commercial channels and that it was open to SA equally to obtain these. It was added that Israel had obtained no authorization to purchase arms from the US Armed Forces.

Fuad Bey stated SA by this time appreciated some of the difficulties in the way of the fulfillment of its complete desires. It could be most

'Information on the proposed negotiations for a treaty of friendship, commerce, and navigation is in Department of State file 611.86A4.

See the memorandum of conversation of April 19, p. 1166.

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unfortunate if it were suddenly to be confronted with an adverse de- cision on the O'Keefe report and he hoped the SAG might be kept currently informed of the progress of the USG's purposes with respect to SA to avoid the shock of some sudden unexpected reverse to the aim we were seeking of bringing about closer relations. Mr. McGhee reassured him on this.

At the end Shaikh Yusuf raised the question why, if we professed such friendship for SA, we could not make available military aid on a grant basis such as we had made available to other countries, includ- ing, in particular, Greece and Turkey. Mr. McGhee replied that this was not a matter of friendship and pointed out that the resources of the United States were not unlimited; that we already were suffering from a budgetary deficit this year of approximately 5 billion dollars and that it was essential for us to confine our grants of military aid to those countries whose economy did not permit them to sustain the cost of such a burden. Our National Advisory Council who made policy in such matters, required countries who were in a position to pay, like SA, to obtain assistance on a reimbursable basis. Greece and Turkey were not able to repay.

'Shaikh Yusuf said in conclusion that there were two things which His Majesty really desired: (1) arms on a grant basis; and (2) con- clusion of a military alliance. However, we had discussed with him the possible alternatives. He realized that SA desired more than we could fulfill, whereas the United States had offered less than SA desired. It was agreed that our purpose would be to reach a common ground between these two.

In the morning of March 23 the word was sent to us that His Majesty was somewhat fatigued and would not be able to receive us as planned but that instead we would be received by Crown Prince Saud.

The Crown Prince welcomed us very cordially and stated what a great satisfaction it was to have the visit of Mr. McGhee and the op- portunity for such frank exchanges of views. He added that Fuad Bey Hamza had reported to him and to His Majesty at great length the conversation of the evening previous. The Crown Prince said while SA desired a treaty of alliance, it fully appreciated the difficulties which stood in the way of the conclusion of such an agreement, as had been explained by Mr. McGhee.

Mr. McGhee remarked that it was very gratifying to know that our warm friend SA had understood our difficulties and that it was a mark of the closeness and friendliness of our relations if we en- deavored to understand and appreciate the problems of the other in connection with our mutual interest. Our friendship was certain to be founded on a fundamentally strong and lasting type when we took

1151

FOREIGN RELATIONS, 1950, VOLUME V

the pains to understand one another's point of view in solving our common problems. He added that he has already convinced his father of USG's procedure and its circumstances which His Majesty now has absorbed and understands very well.

The Crown Prince stated he very much hoped this would not be the last visit which Mr. McGhee paid to SA but only the first. .

On the afternoon of March 23, on our way to another audience with His Majesty, Fuad Bey Hamza met us and stated that after an ex- planation of the conversation of the previous evening to His Majesty and the Crown Prince, His Majesty had been persuaded to accept the bases as outlined by Mr. McGhee for our relations. Fuad Bey sug- gested that Mr. McGhee summarize the points briefly for His Majesty and to emphasize that SA would be kept advised before Congressional action was sought and the progress of the steps which were being taken in the United States toward the realization of a military program.

When we were received by His Majesty, Mr. McGhee went over the points briefly and gave the suggested assurances to His Majesty.

His Majesty stated that he welcomed these assurances and that he wished it to be understood that he considered the United States and SA as one state. He said that he hoped, when final plans for mili- tary aid had been worked out, someone might be sent to SA, such as Mr. McGhee to- review them with His Majesty before final decision for their execution is reached.

Later in the afternoon we were received by the Crown Prince at his summer palace and were offered tea; followed later by dinner.

During the dinner the Crown Prince was asked what his views were concerning the development of Yemen. He stated he could best answer by recounting the conversation he had in Cairo a few days previous with the Yemen delegate to the Arab League who called on him. The Crown Prince said he had expressed the hope that Yemen would open itself to greater development and contact with the outside world. The Crown Prince pointed out that SA had welcomed an American oil company and had benefited greatly by this enterprise without any prejudice to its sovereignty and that the only way Yemen could raise the standard of living of its people was by welcoming outside assist- ance. The Crown Prince said the Yemen delegate expressed thorough agreement. The Crown Prince said that according to all the informa- tion of the SA Government, conditions in Yemen were anything but stable and he hoped that when Mr. Childs visited Yemen he would urge the same views on the Yemen Government 8

For documentation on this topic, see pp. 1355 ff.

1152

SAUDI ARABIA

Mr. McGhee remarked that private investment in fields where pro- duction could be undertaken in SA such as textiles, glass, cement, etc., was one of the means which might contribute greatly to the advance- ment of SA. The Crown Prince said SA would welcome this private investment, either directly or in partnership with SA capital.

After dinner Mr. McGhee referred to the audience with His Majesty in the 'afternoon during which His Majesty had spoken of the alarm- ing exodus of rivals from SA and the need for examining the situation and studying the possibility of introducing the Indian Rupee. The Crown Prince said he was in thorough disagreement with this and thought Mr. McGhee had been well advised to make the suggestion that the matter be studied by experts. It had been suggested and agreed upon that an effort would be made to obtain the services of Mr. Judd Polk from the Embassy in Cairo to come to Jidda' to confer with the Finance Minister and give disinterested advice as to how the Government might best proceed in this matter. Mr. MeGhee said that a stable currency in which the people had confidence was a funda- mental pre-requisite to a stable economy. He added that when SA studied its needs under the President's Fourth Point and so desired the United States would be glad to make every effort to find sulitable financial technicians who might come to SA to give advice and assist- ance in these technical financial matters.

In the final audience with' His Majesty on the evening of March 23, appropriate remarks were exchanged with respect to the visit of Mr. McGhee and both His Majesty and Mr. McGhee expressed satisfac- t ion with the conclusions reached in the conversations which had been held. His Majesty reiterated his strong opposition to Communism which was based on the fact that [it?] opposed religion which con- stituted the basic element in Arab life, and also because it was an aggressive force. He stated that the stability of the Arab world is an extremely important factor in safeguarding against the spread of Communism since any disaffection in the Arab world would spread elsewhere. He pointed out that Communism had made some gains in the Arab world, particularly in Iraq and Egypt, and urged the US to make efforts to assist in counteracting such movements. His Majesty gave China as an example as to what happens when such movements are unchecked. Mr. McGhee replied that the US sought, through assist- ing these countries in their economic development, to provide them with an incentive to continue to cooperate with the free world by demonstrating that such cooperation offered more than adherence to Communism.

1153

FOREIGN RELATIONS, 1950, VOLUME V

Mr. McGhee said that the friendship of the two countries involving the interchange of advice was one extending to the giving of advice by SA with respect to the Arab and Islamic world to the United States. His Majesty replied that one manner in which the United States could be very helpful was in supporting the Arab League and in urging and promoting unity among the Arab states.

Mr. McGhee promised that he would convey to the President the generous remarks of His Majesty with respect to the United States and advise him of the satisfactory conclusions reached.

786A.5MAP/4-350: Telegram

The Chief of Staff of the United State8 Amy (Collims) to the Vice Chief of Staff of the United State8 Army (Haislip)'

SECRET PRIORrY JIDDA, April 3, 1950-5 p. m.

194. Personal for Haislip from Collins. Reference WAR 81319, 31 March.2 Provided it appears likely favorable action will be taken this session Congress to provide reimbursable aid for Saudi Arabia under FY 51 MDAP legislation and provided prior assurances such favorable action is obtained from appropriate Congressional leaders, recommend that JCS authorize token shipment 5,000 rifles with am- munition on loan basis to be chargeable later Saudi Arabia as part of aid program. Recommend furthermore token shipment be made in case it becomes evident to State Department that no satisfactory in- terim agreement can otherwise be reached for use Dhahran air base. Suggest that necessity of token shipment be left to discretion Am- bassador Childs. In this connection Ambassador Childs and General O'Keefe inform me that possibility exists of reaching acceptable in- terim extension for period of 6 to 9 months without loan of equipment prior to Congressional action. If it appears MDAP bill permitting reimbursable aid to Saudi Arabia will not be acceptable to leaders of Congress, I consider it inadvisable for JCS to commit themselves to token shipment at this time.

[CoLNs]

'The source text was transmitted as telegram 194, April 3, from Jidda, and was relayed to the Department of the Army for Gen. Wade Haislip at 10: 30 p. m.

Saudi Arabia was one of the places visited by Collins during an inspection trip he made to the Middle East from March 20 to April 8. For more information, see excerpt of his report, p. 1158.

' Not found in Department of State files.

1154

. SAUDI ARABIA

SOA.413/4-350

The Ambassador in Saudi Arabia (Childs) to the Secretary of State

SECRET JDDA, April 3, 1950. No. 155 Subject: Christian religious services held on the Dhahran Air Base

During a call at the Foreign Office on March 29, Khairradin Bey,1 temporarily in charge, stated that His Majesty and the Minister of Defense had received a report that an American "Missionary", Captain Sloan, 2 was holding public religious services on the Dhahran Air Base attended not only by officers and men of the USAF but also by people from Aramco. In a long discussion which followed Khairradin Bey emphasized that Saudi Arabia was unique among Arab and Moslem states in that it included the Moslem holy places and that not since the time of Mohammed had any Christian activities ever been permitted in the country.

I informed Khairradin Bey that this was an extremely delicate question and that I hoped the Saudi Arabian Government would not bring it up in a way to make it difficult for us. I said very frankly that to press us unduly might have extremely unfortunate consequences.

In my discussion I emphasized that we fully appreciated the deli- cacy of the question for the Saudi Arabian Government but we expected the Saudi Arabian Government to show as great an under- standing of our difficulties as we were disposed to show of theirs. Both I and Aramco had been pressed for an active pursuit of the matter with the Saudi Arabian Government but we felt that the situation would work itself out if the matter were handled with appropriate delicacy and if neither side were precipitate. I assured Khairradin Bey that so far as I was aware there were no American Christian "Missionaries" in Saudi Arabia nor were there any regularly estab- lished churches and I could assure him further that there were no public Christian religious services being held so far as I knew. I re- quested him earnestly not to press me for any further assurances be- yond these. I said that I could not believe His Majesty would object to the assembling privately of officers and men of our air base at Dhahran for the saying of their prayers.

Khairradin said, after considerable argument, that the objections of the Saudi Arabian Government were not to what occurred in the privacy of the homes or quarters of the officers and men but to public gatherings for the holding of public services in a fixed place and at

1 Acting Foreign Minister. The editors have not been able to Identify Captain Sloan further.

538-188--78- 74

1155

FOREIGN RELATIONS, 1950, VOLUME V

fixed times. He said it had come to the Saudi Arabian Government's attention that Captain Sloan was a religious leader who was conduct- ing these services and he wondered if Captain Sloan could not be transferred.

I replied that if the Saudi authorities could present me with facts establishing that Captain Sloan had conducted public services at which Moslems were present or could establish the fact that he had engaged in religious discussions with Moslems I would be glad to bring the facts to the attention of General O'Keefe with a recommendation for his transfer. I could not admit, however, a complaint against Captain Sloan for discussing religious matters with the officers and men of the USAF at Dhahran, as this was a purely internal administrative ques- tion which solely concerned General O'Keefe and the internal orga- nization of the Air Base.

Khairradin's conversation wag extremely conciliatory but at the same time he sought by every means to obtain more specific assurances from me that no regular services would be held in a specific place at regular times which were open to the public. I avoided giving any such assurances and made it plain to him as diplomatically as possible that I could not and would not interfere with the holding privately of devotional exercises at Dhahran for the American officers and men of the USAF, but I stated I would take steps to see that such gather- ings were restricted exclusively to those officers and men, and that there were no public gatherings to which outsiders might have access. I did everything possible to impress on Khairradin Bey the necessity of letting sleeping dogs lie as quietly as possible. He said he realized that I had a very great appreciation of the Saudi Arabian Govern- ment's position in this matter. I said that I did but that if we were to keep this question from arriving at a very dangerous impasse it would be well for the Saudi Arabian Government to show as much under- standing and appreciation of our situation as we had been disposed until now to show of theirs.

Later our very able Arab Secretary, Mohammed Effendi, said that when we were recently in Dhahran, Colonel Nagshabandi a had in- formed him that a party of Saudi officials had visited the Airport on Sunday, March 5th and that their attention had been attracted by the numerous cars and visitors outside the Character Guidance Center and that he had been obliged to disclose the nature of what was taking place in answer to their inquiries. Mohammed said he believed this was the occasion for the latest dgmarche on the part of the Foreign Office.

J. Rivss CHImS 8 Lt. Col. Salim Nagshabandi, Saudi Arabian Army.

1156

SAUDI ARABIA

786A.11/4-850: Telegram

The Charg6 in Saudi Arabia (Hill) to the Secretary of State

SECRET PRIORITY JIDDA, April 8, 1950-5 p. m. 203. On April 6 I informed Khairadeen Bey, Acting Foreign Min-

ister, substance Deptel 124, April 5.1 This afternoon he read me fol- lowing telegram signed by King:

"We welcome coming of special physician of President Truman to head defense medical team. Inform American Embassy and ask them transmit our thanks to President Truman for this gracious attention which we appreciate."

Shortly after my return to Embassy Khairadeen Bey phoned ur- gently to say that message had just arrived from Royal Cabinet stating they had telegraphed SA Ambassador Washington directing him ask Department and President Truman in a personal way not to permit any news either press or radio concerning medical team coming here until mission finished and team departed on return trip. He added that this was considered essential precaution to prevent any rumors arising that some very serious matter was reason for medical team coming here so urgently. Message added that SA Ambassador also being in- structed transmit to President Truman the thanks of His Majesty for such kind attention.

Re foregoing paragraph, Department will recall from previous re- ports this Embassy the extreme sensitiveness SAG to any possibility .rumor concerning illness in royal family.

Re last sentence Deptel 124, in belief Ambassador would prefer comment himself, I relayed telegram to him at Aden on April 6.

HML

1 Not printed; it Informed the Embassy that the President would like to send his personal physician, Brig. Gen. Wallace H. Graham, as the head of a proposed Department of Defense medical team. It asked the Embassy to consult the Saudi Arabian Government to find out if that would be agreeable and ended by saying that the Embassy's comment would be appreciated. (786A.11/4-550) A report on the visit of the medical mission is on p. 1169.

1157

1158 FOREIGN RELATIONS, 1950, VOLUME V

786A.5/4-1950

Excerpt of Report by the Chief of Staff of the United States Army (Collins) to the Secretary of the Army (Gray)'

TOP SECRET [WASHINGTON, April 1950.]

Saudi Arabia a. Unfortunately my visit to Dhahran was so short that it was not

possible to make any detailed inspection of the Air Base which, of course, is under Air Force control.

b. In my several conferences with Ibn Saud and his principal ad- visors, which are detailed in appendices hereto, I was impressed with the fact that at no time did any Arab raise the question of the exten- sion of our base rights at Dhahran. I do not believe this was an over- sight but rather, to me, indicated that at least a subconscious accept- ance of the fact that American Base Rights at Dhahran would be continued.

c. The thought uppermost in the minds of Ibn Saud and his advisors was the early implementation of the so-called O'Keefe report, however modified it might be. I believe that I convinced them that it would be far wiser to accept a more gradual and modest modernization of their Armed Forces than that envisaged in the O'Keefe report.

(1) I am certain that the Arabian officials were shocked at the cost of the proposed O'Keefe program. They immediately proposed a monetary grant-in-aid to provide sufficient funds for military equip- ment. I believe Ambassador Childs and I convinced them that this would not be possible.

(2) At the specific request of the King and his principal advisors and with the full assent of Ambassador Childs, I have made a record of our discussions with reference to the strength and organization of Arabian Forces. A copy of this discussion is attached hereto as Annex 6. I have agreed to furnish copies thereof to Ambassador Childs for transmittal to Ibn Saud.

d. I am convinced that Ibn Saud is more concerned over possible warfare resulting from some subsequent expansion of Israel than he is over any threat from Russia. However, he and his advisors are fully

'The source text was enclosed in a memorandum of April 19, by Lt. Col. Stanley R. Larsen, Aide to General Collins, to Francis E. Meloy, Jr., of NEA/ANE; not printed. Larsen asked that the Department of State forward it to the Ambassa- dor In Saudi Arabia, and a copy was sent to Jidda on May 18. (786A.5/4-1950)

On his March 20-April 8 Middle Eastern inspection trip, Collins went to Italy, Trieste, Greece, Turkey, Iran, Egypt, and Tripoli, as well as Saudi Arabia. This report and the attached Annex 6 were a portion of his overall report on the Middle East. For a memorandum of Collins' conversation with President Inonu, dated March 26, see p. 1241. Annex 5 is printed on p. 507. A copy of Collins' com- plete report, attached to a memorandum for MeGhee, Is in Department of State file 780.5/4-1750.

SAUDI ARABIA

cognizant of how serious such a threat would be, not only to Saudi Arabia but to the Moslem World. The Arabs would fight to the limit of their ability if threatened by Russia.

e. With reference to a proposed token shipment of rifles to Saudi Arabia (see CM-IN 16971, 4 April 1950 2), I believe that if Congress approves a MDAP program for Saudi Arabia clearance should be obtained from appropriate Congressional leaders for a shipment of 5,000 rifles and an appropriate amount of ammunition. Decision as to offering such a token shipment should rest with Ambassador Childs, who assures me that he will use the authority only if he finds it neces- sary in order to obtain an extension of our base rights in Dhahran

2

f. Action to be taken:

(1) G-3 take appropriate steps to expedite action leading to the initiation of a modest MDAP program, on a reimbursable basis, for Saudi Arabia, including a token shipment of arms, if such is deemed advisable by Ambassador Childs.

Annex 6

Saudi Arabia

1. Shortly after arriving at Riyadh on 2 April 1950, Ambassador Childs, General Collins, Colonels Johnson, Dodge and Howze called upon the King, Ibn Saud. The King greeted the party very graciously and extended a welcome to Saudi Arabia. The King's good humor was.indicated by the fact that he gave a detailed account of his capture of the Palace of Riyadh fifty years ago with a party of only 40 men.

2. At four o'clock in the afternoon, following customary procedure, the party paid its respects to the King.

3. Following this audience, the party then met with Crown Prince Saud; Prince Mansur, Minister of Defense; Fuad Bey Hamza, Min- ister of State and Counselor to the King.

4. At this conference General Collins outlined the current status of the O'Keefe report and stated that an abbreviated copy of this report had been forwarded by the JCS, without any final action on their part, to the U.S. Secretary of Defense for transmittal, through the Secretary of State, to Ibn Saud. 4

5. General Collins pointed out that the whole matter of military aid to Saudi Arabia was still under study and emphasized the fact

Not found in Department of State files. 'Handwritten notes on the source text, "deleted from enclosure," indicate

that paragraphs e and f were deleted from the copy forwarded to Jidda. 'Paragraphs 4, 10, and 30 were deleted from the copy of the source text that

was sent to Ambassador Childs for transmittal to King Saud, and the following paragraphs were renumbered.

1159

FOREIGN RELATIONS, 1950, VOLUME V

that no final action would be taken until Congress authorized appro- priations. He further pointed out that if the usual MDAP procedures were followed, it would be necessary to consummate a bi-lateral treaty between the U.S. and Saudi Arabia. He made clear that this treaty would not be a military or political alliance but would simply stipulate the extent of the program and the method of financing it. The next step would be the completion of negotiations between representatives of the Arabian government and U.S. officials to determine the exact nature and extent of the program.

6. General Collins then asked if the Crown Prince would care to have General Collins' personal observations as to the type and orga- nization of forces which he would recommend for the Arabian Army. The Crown Prince and his associates immediately expressed a desire to obtain General Collins' views.

7. General Collins then told the party that he had read the O'Keefe report. While it represented a very fine study, he was convinced that the forces proposed would be much too large and costly to be main- tained by the Arabian Government. He stated that the U.S. Army staff had made an analysis of the costs involved in such a program and determined that the cost would amount to at least 107 million dollars. This cost would cover the provision of equipment, necessary ammuni- tion, packing, crating and transportation charges and the establish- ment of necessary shelter for a U.S. military mission which would be needed to train the Arabian Army. Even if this cost were spread over a period of 5 years, the annual cost would be approximately 22 million dollars. Since it would not be possible to create and train newly equipped forces immediately, it would be necessary for Saudi Arabia to continue to maintain its present forces for some time. The 22 million dollars for the new forces would be over and above the annual cost of maintaining the residual current forces.

8. When asked what the current military budget was, Fuad Bey replied it was about 9 million dollars. However, he admitted that this did not represent the entire military budget. It was then pointed out that for at least the first 2 years the annual cost would total at least 31 million dollars since the bulk of the present forces would have to be maintained. This would be nearly four times the present military budget. General Collins stated that he doubted very much that the country could afford to spend that much money on its armed forces at this time.

9. Ambassador Childs pointed out that when the O'Keefe report was drafted the financial situation of the government was different from that now existing. In 1949 oil production was rising with conse- quent increase in oil royalties; the O'Keefe report was developed using

1160

SAUDI ARABIA

a Saudi income approaching 100 million dollars annually. In the mean- while there has been a falling off in the demand for oil and a cutback in oil production, with the result that in 1950 government revenues were likely to be substantially below those of the high-water mark of 1949. The Ambassador added that there was a serious question as to whether Saudi economy could support the very heavy military charge.

10. Fuad Bey said the government was well aware of this problem and that consideration was being given already to the means of in- creasing oil royalties. (This short paragraph should be omitted from the copy of the report forwarded to the Arabian Government.)

5

11. General Collins then suggested that rather than to embark on such an ambitious program, it would be far wiser to initiate a more feasible and modest one. He made the point that it was not simply a question of money but also the problem of the ability of the Arabians to absorb the new techniques and to establish and to train the essential non-commissioned officers and experts who would be required to handle this equipment. He pointed out that it would take some time to estab- lish schools and to develop competent instructors in the Arabian forces. If this were not done, valuable equipment would stand idle and rapidly deteriorate. Should such equipment be seen by visiting Congressmen from America it would have a very bad effect. It might well result in the curtailment of the program. General Collins, therefore, suggested that it might be well to start with an Army force of three infantry regimental combat teams and a modified mechanized cavalry regiment.

12. General Collins outlined to the Arabians the American tri- angular system of organization under which each unit consists of three smaller homogeneous elements plus a fire support unit. This type of organization is designed primarily for an attack. For any attack there must be three elements; first, the force which finds the enemy and holds him in place. This is called the finding and fixing force. Next, there must be a maneuvering unit which is employed to outflank the enemy who has been fixed in position by the holding force. Third, it is necessary to have a reserve in order to carry home the attack and destroy the enemy. Each of these homogeneous units requires the movement of men and equipment over the ground. It is necessary for the commander to have a fourth element by which, without the move- ment of men or equipment, he can shift his supporting fires to assist any part of the attack. This fourth element is called the fire support unit.

13. All U.S. Army organizations are based on this theory of attack. For example, a platoon consists of three rifle squads and a fourth light

Paragraphs 4, 10, and 30 were deleted from the copy of the source text that was sent to Ambassador Childs for transmittal to King Saud, and the following paragraphs were renumbered.

1161

FOREIGN RELATIONS, 1950, VOLUME V

machine gun squad, the latter being the fire support element. A com- pany consists of three platoons and a light mortar and machine gun platoon. A battalion consists of three rifle companies and a heavy weapons company. A regiment has three battalions and a heavy mortar company and finally a division consists of three regiments and an artillery group.

14. There are two great advantages of this type of organization. First, young officers familiar with the method of handling a platoon have no new principle to learn when they become company com- manders, a good company commander can readily handle a battalion, and so on throughout an officer's career. The second great advantage and one which would have special application to Saudi Arabia, is that, if after the three regimental combat teams were well trained and equipped and the government should decide then that it could increase the size of its army, each of these regimental combat teams could be expanded to become a division. This could be done by adding men and material to each company so as to convert it into a battalion. Each battalion could be expanded into a regiment and then each regiment could then become a division. Thus, under the framework of the pro- gram suggested by General Collins, the Saudi Arabians might ulti- mately develop three infantry divisions and a light mechanized division, the latter being created from the original mechanized regiment.

15. Fuad Bey then interrupted to say that while this was very logical, the Arabs had felt that the forces recommended by the O'Keefe report represented the minimum forces with which Saudi Arabia could start. General Collins again pointed out the great costs involved and the lack of wisdom in embarking on such a large scale project until the proper groundwork had been laid by training the necessary spe- cialists in schools.

16. Without divulging the contents of the O'Keefe report, General Collins pointed out that he could not agree with some of the units recommended in the report.6 For example, the report provided for a parachute battalion or its equivalent. General Collins told of his ex- perience with two airborne divisions in the Normandy campaign and pointed out how complicated and difficult were airborne operations. He stated that with the relative short distances in Saudi Arabia it would be better to employ perhaps a mechanized regiment to seize a given area and then to move troops by air transport or overland by trucks rather than to parachute them from the air.

o In the copy sent to Saudi Arabia, the latter part of this sentence read: "Gen- eral Collins pointed out that he could not agree with some of the units recom- mended in the O'Keefe report."

1162

SAUDI ARABIA

17. In answer to a query, General Collins began to outline the method now used of transferring equipment under the Mutual De- fense Assistance Program (MDAP). However, it was necessary to adjourn the meeting in order that the Arabians might have time for their evening prayers.

18. Following dinner, given by the King, the conference was re- suned. In addition to the Americans and Arabs present during the afternoon discussions the King's brother Abdula, headed the Arabian group.

19. General Collins resumed his discussion of the pricing methods employed under MDAP. He made clear that considerable equipment being furnished countries of Western Europe, Greece, Turkey and Iran was generally surplus to the maximum needs of the US forces. This equipment was divided, for pricing purposes, into three categories as follows:

a. The lowest category consists of such articles as older types of armored vehicles, small bazookas, and certain types of artillery of which the US Army has some surplus above its maximum needs. In the original program this equipment was priced at 10% of its original cost plus the cost of rehabilitation, handling, packing, crating and shipping. This system was changed so as to eliminate the 10% charge; however, the cost of rehabilitation and handling, packing, crating, and shipping has usually amounted to roughly 25% of the cost of new equipment.

b. The second category of equipment contains items which the U.S. needs but are not required for the minimum supply levels felt neces- sary for the U.S. Army. Some examples of equipment in this category are: certain radios, small arms and ammunition, mortars, and 105 mm Howitzers. This equipment has been furnished at its original acqui- sition cost which is roughly the 1945 purchase price. These costs repre- sent approximately one-half of the current 1950 new procurement costs for similar items.

c. The last category of equipment contains those items Which are needed to meet the minimum supply levels of the US Army. Examples of this category are: engineer equipment, artillery ammunition, al- most all types of trucks, recoilless anti-tank weapons. Such items may be furnished at the current 1950 procurement cost if the item can be procured by the time the US Army needs it.

20. Abdula then remarked that the Arabian Army wished to have only new equipment as it had had some bad experience obtaining sec- ond hand equipment in the past. General Collins pointed out that the equipment that might be furnished them would be similar to that being used by the United States itself and being furnished to the Armies of France and Italy. He stated that it would be necessary to rehabilitate some of this equipment but that it would be all in excellent order. It would have a long life if properly maintained.

1163

FOREIGN RELATIONS, 1950, VOLUME V

21. Abdula then raised the question as to whether Saudi Arabia could not be given this equipment as is being done for other countries. He stated that Saudi Arabia was of great strategic importance to the U.S. and that the oil from Saudi Arabia was essential to the U.S. Navy; therefore, the U.S. should be willing to furnish this equipment to Saudi Arabia by means of a grant-in-aid. Prince Abdula also pointed out that the O'Keefe report had been submitted some months ago and that before that there had been discussions by His Majesty Ibn Saud, concerning military aid for a period of 2 years and that nothing had come as yet from these discussions. The inference left was that we did not seem to be any nearer a meeting of minds than we had been before these long drawn out discussions.

22. Ambassador Childs stated that he would assume the responsi- bility for replying to certain of Prince Abdula's remarks as he was intimately acquainted with the background of certain of the problems involved. The Ambassador stated that, as he had so frequently re- marked to His Majesty, the United States Government was a very cumbersome machine. It was unlike the Government of Saudi Arabia where decisions could be implemented at the will of one man. Mr. Childs stated that in his opinion the O'Keefe report was receiving as prompt a consideration as was to be expected in light of the many authorities in Washington who had to pass judgment upon it and all the many other complicated problems with which the American Gov- ernment is faced in all sections of the world. The O'Keefe report, after being studied by' the Joint Chiefs of Staff, of which General Collins was a member, would be referred to the Department of Defense and, thereafter, to the State Department. When the decision had been reached between these authorities and the President's approval had been obtained, it would still be necessary to seek Congressional au- thorization for the implementation of the report.

23. The Ambassador recalled Prince Abdula's statement that the Saudi Arabian Government considered the O'Keefe report recom- mendations an absolute minimum. Prince Abdula had stated the gov- ernment desired even more than the O'Keefe report had recommended. This attitude might be said to be characteristic of all governments today in the world. In the United States, as rich as it is, there is great controversy of the amount of the military budget. No one was ever satisfied regardless of what the military budget might be. The great problem today is to fit the military budget to the financial means available to the country. If an intolerable burden were placed on a country's economy it might be a means of hastening the forces of disintegration and preparing the way for Communism, against which all are seeking to guard themselves.

24. Mr. Childs observed that when Mr. McGhee had visited Riyadh, the week previous, he had taken great care to explain that military

1164

SAUDI ARABIA

grants-in-aid could only be made by the United States to those coun- tries not financially able to bear the cost of such aid. Saudi Arabia was financially solvent and had no external debt. It would be impos- sible to justify to Congress, under these circumstances, any request that the United States should bear the burden of military aid to Saudi Arabia. The United States was already faced with a budgetary de- ficiency of 5 billion dollars and every American was groaning under the burden of income taxes which he was forced to pay, not only to support the American military budget but for military aid to those countries not in a position to pay for it. It would be out of the question to expect the American taxpayer to assume the burden of military aid for Saudi Arabia which was in a thoroughly solvent financial position. The Ambassador stated he would ask General Collins to undertake any additional replies to Prince Abdula's remarks.

25. General Collins stated that he fully supported the position of the Ambassador. He pointed out that it would be necessary in the United States to reduce the military budget one billion dollars for the fiscal year 1951 under that which was appropriated for fiscal year 1950 and that armies everywhere had to reduce military expenditures in order to prevent economic collapse.

26. General Collins then quickly reviewed the world strategic posi- tion as might be estimated by the Soviets. He pointed out that in the event of another major world war, the Soviet major effort would most likely be launched against the countries of Western Europe and Eng- land and that a subsidiary attack would probably be made via Iran or Turkey to seize the Cairo-Suez area. This latter attack might well by-pass Saudi Arabia entirely; however, any attack on Cairo would have to proceed through the Moslem countries, and if successful, would be a blow to the Moslem world.

27. General Collins went on to say quite frankly that, in his judg- ment neither the United States, nor its Navy, would be dependent upon Arabian oil in the event of war. He pointed out that it was likely that neither Russia nor the Western Powers would be able to obtain oil in any quantity from the Middle East. Russia would not be able to do so because of the lack of transportation and both the West- ern Powers and Russia would probably take steps to deny Middle East oil to the other by destroying through bombardment all the great refineries of the Middle East.

28. General Collins went on to say that, although the United States did not regard Saudi Arabia as being in the "front line", nevertheless, its independence was of great concern to the United States. The United States would, from a strategic point of view, have to deliver its major military aid under the MDAP programs to the Western Powers and to the countries in the Middle East which were in im-

1165

FOREIGN RELATIONS) 1950, VOLUME V

mediate contact with Russia. He stated that, in his judgment, based on experience with the appropriations committees of the Congress, it would not be possible to obtain a grant-in-aid to Saudi Arabia for military supplies but that if Congress would approve a program it would be on a reimbursable basis.

29. After some further discussion and at the request of the Crown Prince, General Collins agreed to furnish a transcript of the entire discussions, including an outline of his proposals for consideration for the officials of the Saudi Arabian Government. This transcript is intended to serve this purpose.

30. It is particularly interesting to note that not once in the dis- cussions outlined above was the subject of the renewal of the lease to Dhahran Air Base raised by any Saudi Arabians. They gave the impression that they accepted as a foregone conclusion the extension of U.S. base rights at Dhahran. (This paragraph should be omitted from any copy of the report forwarded to the Saudi Arabian Government. 7)

Paragraphs 4, 10, and 30 were deleted from the copy of the source text that was sent to Ambassador Childs for transmittal to King Saud, and the following paragraphs were renumbered.

886A.10/4-1950

Memorandum of Conversation, by Messrs. Samuel Gorlitz and Wilfred Koplowitz of the Investment and Economic Development Staff

CONFIDENTIAL [WASHINGTON,] April 19, 1950.

Subject: Saudi Arabian Eximbank Application for $16.4 million loan.

Participants: Mr. Snodgrass-International Bechtel, Inc. ANE/E-Mr. Burns ANE/E-Mr. Strong ED-Mr. Gorlitz ED-Mr. Koplowitz

The Eximbank is now considering the application from Saudi Arabia for a loan of $16,456,000. The credit is intended to finance 11 projects of a public works nature. (See attached list.) The applica- tion was made through a letter from the Saudi Arabian Minister of Foreign Affairs to the U.S. Ambassador in Jidda and was forwarded to the Bank by the Department on March 24, 1950. The Saudi Arabian Ambassador to the U.S. confirmed the request in a letter to ir. Gaston, Chairman of the Bank.

Mr. Snodgrass has just returned from Saudi Arabia. He is a vice- president of International Bechtel, Inc., the American engineering

1166

SAUDI ARABIA 1167

concern which has been working for Aramco and the Saudi Govern- ment. The project presentation was prepared by Bechtel. Several of the 11 projects have already been begun under previous Bechtel contracts.

This meeting followed a luncheon at which Mr. McGhee, Mr. Stinebower, Mr. Wilkins, Mr. Burns and Mr. Snodgrass were present.

Mr. Snodgrass traced the origins of the present loan application admitting the hastiness of preparation. This seemed to have been dictated by the development of a Saudi Arabian financial crisis and the resulting shortage of building materials needed to continue going and planned operations. In the event that external aid would not be rapidly forthcoming, he said, a serious reduction in the Bechtel labor force would become necessary.

After a discussion of the projects, the Department officers men- tioned various factors likely to be considered by the Eximbank.

1. Regarding the problem of repayment, it was suggested that the Bank might request the assignment of future oil royalties to loan serv- ice. Mr. Snodgrass felt that the Saudi Arabian Government and Aramco might be reluctant to agree to such a condition.

2. On the subject of costs, two points were made: a) since the pres- ent figures were such tentative estimates additional breakdown and accuracy would probably be requested, and b) local currency costs have not been separated out of the total estimated costs. Therefore, it seems that the Eximbank is being asked to finance both foreign exchange and riyal components. Mr. Snodgrass was told that it is customary for the borrowing country to meet local costs from its own funds, and to provide details as to how it intends to do so.

3. The self-liquidating character of the projects was questioned since even the revenue-producing projects will not, for the most part, earn dollars directly.

4. The integration of the projects into the general development picture and their relationship to each other was discussed. Mr. Snodgrass stated that present plans were to complete the projects in about two years. The suggestion was made that Mr. Snodgrass be prepared to answer Eximbank inquiries as to why completion of all projects in two years was intended instead of the more usual proce- dure for underdeveloped countries of proceeding with a smaller work force more slowly, using the skills and income gained from each com- pleted project on the next.

5. Since there has already been a substantial investment in several of the projects the comparatively small additional investment will result in important returns to the country in a comparatively short time. This point might be stressed, but it also opens the question of why the Saudi Government ran out of funds for projects underway. The loan of the Saudis to Syria is a partial explanation.,

6. The problems of Anglo-American relations in Saudi Arabia was introduced in a question concerning the status of the English Electric Company contract for the electrification of Jidda. Mr. Snodgrass

See footnote 11, p. 1144.

538-188-78- 75

FOREIGN RELATIONS, 1950, VOLUME V

stated that as far as he knows the terms of the contract involved only the purchase of equipment and that Bechtel was free to undertake the electrification of Jidda under the proposed loan. He indicated that wherever appropriate companies other than his own would be included in the project work.

Mr. Snodgrass asked if there was any possibility of immediate action by the Eximbank for about $2 million to allow the procurement of the backlog of materials needed to maintain current operations. The De- partment officers did not consider that such action by the Bank would be likely.

Comment: It appeared to the Department officers present that Mr. Snodgrass had not anticipated the Eximbank's specific, technical re- quirements which were pointed out to him. He communicated to Mr. Gorlitz upon leaving the building his and the 'Saudi Government's understanding that this application was to have been dealt with and expedited on a political basis.

Mr. Gorlitz received a telephone call from Mr. Snodgrass on April 20, concerning a meeting of that date between Mr. Gaston and the 'Saudi Ambassador. It seems that as a result of questions from Mr. Gaston relating to Eximbank normal requirements the Ambassa- dor left the interview extremely discouraged. He indicated, however, that he would not report to his Government until further discussions had been held with the Department and the Bank.

2

[Attachment]

Project

Jeddah 1. Pier, causeway, and marginal wharf 2. Hospital 3. Sewage system 4. Quarantine stations 5. Airport facilities 6. Shop facilities 7. Power plant and line to Mecca 8. Jeddah-Mecca road

Riyadh 9. Power plant extension

10. Airport facilities

Dammam 11. Free port area and transit warehouse

Total

Estimated cost

$845, 000 2, 189, 000 1,900, 000

950, 000 958, 000 258, 000

5, 750, 000 766, 000

540, 000 1,300, 000

1,000, 000

$16, 456, 000

'The Export-Import Bank approved a credit of $15 million for the Saudi

Arabian Government on July 20. Further information is in the editorial note, p. 1181.

1168

786A.11/4-3050

Memorandum by Mr. Frederick H. Awalt of the Office of Arabian Peninsula Affair8 to the Ambassador in Saudi Arabia (Childs),

SECRET [RIYADH?,] April 30, 1950.

Subject: Special Medical Mission for King Ibn Saud. The special medical mission sent to treat King Ibn Saud arrived

on schedule at Riyadh at noon, April 18. The party was headed by Brigadier General Wallace H. Graham, USAF, personal physician to the President, and included Capt. Frank P. Kreuz, USN, orthopedist, Dr. Gilbert H. Marquardt of Northwestern University, specialist in internal medicine, Dr. Darrell C. Crain, Jr., arthritis specialist in Washington, D.C., Edward E. Stults, pfc, USA, x-ray technician, James D. Brown, HM2, laboratory technician, Ralph D. Rich, HM1, USN, physio-therapist technician, and Fred H. Awalt of the Depart- ment of State.

Mr. Heyward Hill, Counselor of Embassy at Jidda had come to Riyadh the day before to greet the party and make the proper intro- ductions at Court. He was accompanied by an Embassy interpreter, Bakur A. Khomais.

The party was accommodated at the new guest palace recently com- pleted for the King of Afghanistan.2 It was comfortably furnished and complete and private bathroom facilities were provided. Every room was equipped with ceiling fans. The dining room was large and furnished in western style. All food came from the Crown Prince's palace where a large stock of American canned goods are kept. Every effort was made to prepare the food to our liking.

Our initial reception by the King was at 4: 00 p. m. and His Majesty was very patently glad to see us. He said he was deeply touched by the President's gesture in sending him his own physician. He wel- comed the whole group warmly and said that he would be at the entire disposition of the doctors. The King seemed considerably aged. and enfeebled since my last visit to Riyadh in 1946 and his voice was very low and his words mumbled. He made to [no] attempt to rise upon our arrival or departure. His Majesty uses a wheel chair constantly when moving about, but the treatment given by the doctors relieved him a great deal from the stiffness and pain in his knees and reduced the swelling in his legs to almost normal. Before our departure on May 1st, he was able to move about with considerable ease and with his knees fully straightened. He was delighted with the progress made in improving his condition.

"Childs transmitted the memorandum to the Department as an enclosure to despatch 232, April 30, from Jidda, not printed (786A.11/4-3050).

aThe King of Afghanistan had been in Saudi Arabia March 15-20.

1169SAUDI ARABIA

FOREIGN RELATIONS, 1950, VOLUME V

The King has become increasingly senile and on a few occasions was pettish and even angry with his servants in our presence. Two inci- dents involved his doctors who, the mission is convinced, have done very well by His Majesty and could have done better had the latter accepted their recommendations and treatment. The mission over- looked no opportunity to commend the Court physicians to the King. Although the King's doctors, Madhat Sheikh al Ard and Adib Tebni, may well have viewed the mission's arrival with some misgivings at first, General Graham and his team worked closely with them from the outset and won them over to complete friendship and cooperation. Dr. Said Abdul Rahim Dabbagh, a very capable bacteriologist brought to Riyadh from Jerusalem by Dr. Madhat, was very helpful to the mission, although His Majesty objected to his attendance upon him. Friendly relations were also established with several other doctors in Riyadh, including Dr. Adib Hashim from Mecca, Dr. Frederick Waltherscheid, a Nazi refugee from the British, and Dr. Hans Mueller, a Nazi refugee from the US occupied zone of Germany.

Although ministering to the King was the principal purpose of the mission, and daily and sometimes twice daily treatments were given, the doctors were in heavy demand by other members of the Royal Family and by high officials of the Court. Among these were the Emir Saudi bin Jiluwi of al Hasa, Fuad Bey Hamsa, King's Councillor, Rushdi Bey, Chamberlain, the King's favorite sister, Nura, Rashid Ali al Kilani, the refugee from Iraq and the British, a former wife of the Crown Prince, his three daughters, several princes, and Abdul Rahman Tubeshi, King's Councillor.

The mission was given every facility possible for carrying on its work and it received lavish and most cordial hospitality from the King and several of the princes. No effort was spared to make our stay comfortable and we had complete freedom of movement in and out of the palace and through the city, including the colorful market of the old walled area. . It was noted with considerable interest that many of the old restric-

tions on music, games, toys, and other forms of non-religious pastime have been lifted in Saudi Arabia. The Crown Prince has a soccer field laid out at one of his palaces and games are played on Friday after- noons. Many of the younger princes participate and on Friday, April 25, the American visitors and the Bechtel men were invited by the Crown Prince to play baseball at his Nasiriya Palace, followed by a challenge soccer match with the local Saudi team. The latter played in regulation shorts and skivvy shirts and performed very well indeed, beating the Americans 6-0. HRH the Crown Prince was an interested and even active spectator, along with a considerable en- tourage. On a brief visit to Jidda several football fields were seen and

1170

SAUDI ARABIA

games there attract very sizable crowds. Some inter-city games are played. In addition to football, at least two of the Princes, Emir Saud and Emir Tallal, also have facilities for swimming, tennis, badminton,. and other outdoor sports. It is recalled that some six years ago, several, Arabs who were playing with a homemade rag ball in Jidda were im- prisoned, and the Bechtel personnel in Riyadh report that up to a year ago police would smash any phonographs or toys they came upon. Sports and other forms of entertainment are, therefore, a recent inno- vation in Saudi Arabia, but the speed with which they have taken hold of popular interest is amazing. Most of the credit for this change in Saudi Arabian life is undoubtedly due directly to the Crown Prince.

An old friend from Jidda, Izzedine Bey Shawa, and formerly of Palestine, was in attendance on His Majesty. When it was possible to have a word with him, he told me that he had returned to Saudi Arabia for an assignment in the Government service. I asked if he knew what it was to be, and he stated that he was to be the deputy administrator of a new political unit which would embrace the Tapline area in the northern part of al Hasa and al Nejd Provinces. He added that a Suadairi family leader would be the top authority. I asked when the new administration would go into effect and he replied that he hoped it would be in two or three weeks.

Muzahim Bey Bajahji, former premier of Iraq, arrived in Riyadh on Saturday, April 22, and was lodged in the new guest palace with the medical mission. The purpose of his visit was not ascertained. It was noted, however, that Rashid Ali, the Iraqi rebel who threw in with the Nazis in an abortive putsch in Iraq during the war, abruptly ceased to put in any appearance. He had been coming to the guest palace for treatment of a heart condition, but he failed to keep appointments after Muzahim Bey arrived. He likewise ceased to attend Court or receptions given by various princes during the period of Muzahim Bey's visit, although he had been regularly present at such functions previously. Muzahim Bey departed Wednesday, April 26 and Rashid Ali was observed to have resumed his Court appearances at a recep- tion April 28 given by the Crown Prince. By way of conjecture, it is suggested that Muzahim Bey, having fallen from power in Iraq, may have endeavored to take a cue from Syria and come to Saudi Arabia to seek a loan with the promise of opposing any union of Iraq and Syria.

An unusual entertainment was offered us by the Crown Prince on April 28. He invited us to his usual Friday evening reception and informed us that a special program by the young princes of the royal household would be offered. Shortly after our arrival at the palace a lavish high tea was served. Following that we were invited to attend a program out of doors which had obviously been prepared for the

1171

FOREIGN RELATIONS, 1950, VOLUME V

occasion of our visit. The program was very long and consisted pri- marily of short speeches of eulogy to King, Crown Prince, country, and the flag, but it was particularly notable for several skits and group singing of the national anthem (twice) and of a pledge to the flag. Many of the speeches delivered by the young princes were given in English, a remarkable accomplishment in view of the fact that they had been studying the language only four months. About forty princes participated, ranging in age from 4 to 15 years.

The program was an impressive accomplishment in itself, but it was remarkable also for the fact that this was the first time, according to the Crown Prince, that plays of a nonreligious or comic character had ever been given in Saudi Arabia.

One skit had obvious political implication of great current impor- tance in Saudi Arabia, although it was superficially attributed to Yemen. The King of Yemen, an elderly and infirm old man, was carried in to his throne where he called all his sons about him. Each was asked to discuss an aspect of life that was important to him-love of country, obedience, respect for motherhood, food, etc. After hearing from each, he expressed his thanks to God for such fine sons, and then said he was an old man who had ruled his country 40 years and it was burdensome to him. He forthwith announced his abdication in favor of his eldest son. The implication was very clear and it was notable that the old king, supposedly of Yemen, did not wear the Imami headdress, but the red qutra and gold agal of Ibn Saud, who has ruled 50 years. The skit was suitably applauded by the audience which included over one hundred Arabs as well as ourselves and a few American employees of Bechtel Inc. The Emir Feisal had remained only for the opening part of the program, but his withdrawal was believed to have been prompted by the chill and damp of the evening.

It was interesting to note that the Emir Saud did not recognize the Saudi national anthem when it was first played and Rashid Ali, sitting near him told him what it was. Neither he nor any of the audience stood during either rendition of the anthem. The omission, however, was not indicative of any disrespect, but was undoubtedly merely ig- norance of its national significance. It was a creation of the US Marine Band for the occasion of the Crown Prince's visit to the United States in 1947 and has since been officially adopted for inter- national ceremonial purposes, but it has not yet become familiar in Saudi Arabia where music and musical instruments were until very recently considered offensive.

There may have also been some significance in the repeated cheers by the young princes for the health and long life of the Crown Prince.

1172

SAUDI ARABIA

Similar cheers were given for the Crown Prince and King, but on several occasions cheers were given only for the Prince.

At the close of the program HRH made a point of requesting that the doctors not speak of the entertainment to the King when they were attending him.

886A.413/5-750: Telegram

The Ambassador in Saudi Arabia (Childs) to the Consulate General at Dhahran -

CONFIDENTIAL JIDDA, May 7, 1950-10 a. m. 124. Re Embtel 266 May 6.2 FonOff asked me meet Prince Feisal

late yesterday for further exchange views re extremely delicate ques- tion religious services Dhahran. I had one and half hour talk with Feisal whose statements and conciliatory attitude impressed me greatly as indicating SAG as deeply desirous as we to find some satisfactory formula which would enable matter to be kept within bounds. Briefly Feisal stated :

Saudi Arabia as Holy Land Islam made situation here different than other Arab countries and made it essential King have regard not only for extremely strong feeling existing interior re protection character this Holy Land but also possible criticism from abroad by other Arab or Moslem states.

Prohibition existed against holding any public religious services by any other than four orthodox Sunni sects and this prohibition ex- tended not only to Christian religion but even to Shia Moslem rites as well. King under very great pressure in this respect and Feisal did not believe we realized extent feeling in many parts kingdom. His Majesty was already proceeding much too far in his accommodation Americans. But for great personal prestige of His Majesty, Saudi Arabia would never have been able to go as far as it has in way innovation.

I repeated many arguments I had already used. I stated FonOff had informed me that morning Christian religious leaders not permitted in Saudi Arabia. I knew for fact SAG had invited members Dutch Re- formed Mission Bahrein to Saudi Arabia as doctors who had same holy character as Sloan and furthermore assignment chaplains at

1 This telegram was repeated to the Department of State as 268, here used as the source text.

'Not printed. Childs recommended transferring religious services from the Guidance Center to some other building on the Dhahran Airfield to which Saudi Arabians would not have access and replacing Sloan with an officer who would exercise as much discretion as the Catholic chaplain. (886A.413/5-650)

.1173

FOREIGN RELATIONS, 1950, VOLUME V

airbase no new development. I repeated neither I nor General O'Keefe nor USAF could accept deprivation by USAF personnel spiritual counsellors.

I replied I regretted not having had any comment so far from Gen- eral O'Keefe but I could state frankly I had recommended assemblies cease at Guidance Center and prayer services be transferred to more private premises. I could also state Sloan would be transferred but I emphasized this would not necessarily be tomorrow and SAG must give us time both to avoid any possibility appearance his transfer at instigation SAG and in order to effect his replacement. Feisal stated he could assure me SAG would raise no objections holding private services in private premises not as conspicuously identified as place of worship. Although I had stated Guidance Center not a church, Saudis did not know what a church was and accordingly had come to identify Guidance Center as a church....

In light of all facts it is very evident desire of SAG to find accom- modation us which will not make difficult His Majesty's position with religious leaders. It is my considered judgment foregoing represents most satisfactory solution this very difficult question which has troubled me more than any problem I have had in Saudi Arabia since Palestine partition.

I wish emphasize Sloan's transfer would not be made at suggestion SAG as Feisal assured me there was no suggestion whatsoever of his expulsion. It is my view his transfer would contribute much to relieve situation and it was on this account I proposed it although no immediate urgency.

In face extremely explosive elements confronting King I believe SAG has displayed considerable good will and appreciation our own position in closing its eyes to question religious services Dhahran until we by our own imprudence and excessive zeal forced SAG raise issue. I strongly feel we should take measures now proposed which repre- sent real concessions on part SAG even though some concessions on. our part but which when balanced with need protecting King's posi- tion, conform with our own interests.

It was agreed interim reply would be made to King while awaiting comments from O'Keefe.

CHILDS

'In telegram 82, May 9, from Dhahran to the Department of State, O'Keefe sent a message that he would convert the Guidance Center to a base library, hold worship services in the base theater, and request the transfer of Sloan (886A.413/5-950).

1174

SAUDI ARABIA

786A.5-MAP/5-1050: Telegram

The Acting Secretary of State to the Embassy in Saudi Arabia

TOr SECRET WASHINGTON, May 10, 1950-5 p. m. 164. Deptel 48 Mar 111 and Embtel 250 May 3.

2

1) FYI only State informed by Defense JCS consider, on basis continuing US interests in security of SA, negots to obtain extension DAB agreement and certain additional rights shld be pursued as matter of urgency.

2) JCS have further agreed in principle to provision of mil assist- ance to SA on reimbursable basis and are according priority to study of extent of proposed assistance.

3) Re assistance on token or temporary basis pending congressional action, JCS have determined 5,000 M-1 rifles and 5,000,000 rounds ammunition cld be made available to SA without seriously affecting mobilization capability US services.8

4) Defense has made it clear, however, availability dependent on a) determination that as last resort evidence of US interest is required in connection with negots for extension DAB agreement; b) definite indication favorable action is obtained from congressional leaders as to proposed reimbursable aid program for SA.

5) Dept does not believe that determination under 4) a) cld be justified since it now appears short-term extension may be obtained without token shipment. Re 4) b), in advance presentation leg to Congress, Dept considers inadvisable to request commitment and in any event unlikely congressional leaders wld be willing give such assurance.

6) MDAP 1950-51 draft leg submitted to Budget May 1. Presi- dential submission leg to Congress sched May 24.

7) On basis recent developments in SA (McGhee and Collins con- versations with SAG) and in US (question arms shipments to NE and fact Congress has not yet taken up MDAP leg) Dept considers it advisable to confine your approach to SAG to request for extension present DAB agreement for some period no later than Mar 1, 1951 by exchange of ltrs with intention on our part opening negots soonest when circumstances permit.

Not printed, but see footnote 1, p. 1129. Not printed; it stated that if the Department of State preferred extension of

the Dhahran Airbase Agreement to March 1 instead of January 1, it could prob- ably be arranged (786A.5/5-350).

3 See footnote 3, p. 1130.

1175

1176 FOREIGN RELATIONS, 1950, VOLUME V

8) For purpose facilitating exchange you may if necessary indicate Dept wld be willing in so far as it can be to assist SAG in commercial procurement of such interim supplies as are available in open market. It shld be added however that except for urgent items SAG wld un- doubtedly consider it desirable to await final Defense and JCS rec- ommendations re O'Keefe report before initiating procurement program.4

9) In view foregoing Dept does not believe State-Defense nego- tiating team will be necessary at time of exchange of ltrs but will be required at later. stage when USG is in position to commence discus- sions re long-term agreement.

10) Dept wld, however, like ur views before making foregoing approach.

WEBR

Department of State telegram 173, May 18, to Jidda, not printed, authorized Childs to use the information in paragraphs 7 and 8 when approaching the Saudi Arabian Government, and also to explain to them that the information in para- graph 6 was "required procedure in US for obtaining necessary legislative author- ity from Cong to provide USG procurement assistance on reimbursable basis.'" (786A.5-MAP/5--1850)

986A.524/5-2250

The American Embassy to the Saudi Arabian Foreign Office 1

TOP SECRET

AiDE-MkiE OIIRE

The American Ambassador stated he was authorized by his Govern- ment, in making a request for the temporary extension of the Dhahran Airfield Agreement, to explain that despite every effort on the part of the United States Government to be prepared to discuss the Mili- tary Aid Program to Saudi Arabia coincident with the opening of new negotiations for a long-term Dhahran Airfield Agreement it had not been possible to arrive at that objective prior to the date of ex- piration of the existing airfield agreement.

The Ambassador stated that a draft military aid program for 1950-51 had been submitted to the Bureau of the Budget on May 1 and that it was expected that the President would submit within

'Childs delivered the aide-mdmoire, together with a note making a formal request for the extension of Dhahran Airfield Agreement to February 1, 1951, to Yassin at the Saudi Arabian Foreign Office. He transmitted the aide-mdmoire and note to the Department in despatch 300, May 22, from Jidda. (986A.524/ 5-2250)

SAUDI ARABIA

the next few days such legislation to the Congress. This procedure is the required one in the United States for obtaining necessary legis- lative authority from the Congress to provide United States Govern- ment procurement assistance on a reimbursable basis.

The Ambassador recalled that in the light of statements made on the occasion of the recent visits to Saudi Arabia of Assistant Secre- tary of State McGhee and General J. Lawton Collins, regarding military aid, and in the light of the fact that the Congress has not yet had an opportunity to consider the new military aid program leg- islation, the Department of State is of the opinion that the best means of meeting these circumstances is by a request for a temporary ex- tension of the present Dhahran Airfield Agreement by an exchange of letters 2 with the expression of an intention on the part of the United States Government to open negotiations for a more inclusive agreement as soon as circumstances may permit.

The Ambassador stated that he had been authorized to indicate the Department of State would be willing insofar as it can to assist the Saudi Arabian Government in the commercial procurement of such interim supplies as are available in the open market. He has been requested to point out however, that except for urgent items the Saudi Arabian Government would undoubtedly consider it desirable to await the final Defense Department and Joint Chiefs of Staff recommendations regarding the O'Keefe Report before initiating a procurement program.

In that connection the Ambassador said he had been authorized to inform the Saudi Arabian Government that consideration of the O'Keefe Report actively continues by the Department of Defense and Joint Chiefs of Staff.

Finally, the Ambassador stated that his Government wished to assure the Saudi Arabian Government that when the necessary legis- lation has been enacted containing the necessary authorization to ex- tend reimbursable aid and when the Department of Defense and Joint Chiefs of Staff's recommendations on the basis of the O'Keefe Report are known, His Majesty will be consulted in advance of the defini- tive formulation of plans in the above regard by the United States Government.

JIDDA, May 22, 1950.

An answer from the Saudi Arabian Foreign Office, dated June 17, agreed to extend the Agreement until the following February. The original Saudi Arabian note, a translation, and an affidavit verifying the translation were transmitted to the Department of State as enclosures to despatch 368, June 21, from Jidda, none printed. (986A.524/6-2150)

1177

1178 FOREIGN RELATIONS, 1950, VOLUME V 786.56/5-2550: Telegram

The Ambassador in Saudi Arabia (Child8) to the Secretary of State

TOP SECRET JIDDA, May 25, 1950-11 a. m. 321. Embtel 320, May 25.1 HM requested I have another private

audience with him in afternoon. Before audience I informed Shaikh Yusuf I did not intend to bring up DAB agreement unless Yusuf considered it advisable. He agreed we could settle question together after obtaining King's authority do so.

During audience however, I thought it advisable to give HM briefly status MAP program as set forth in Jidda in my conversations with Yusuf when justifying request for extension to February 1, 1951. At conclusion EM stated very warmly we might have extension and did not ask me any questions but appeared completely satisfied with ex- planation I had given.

Later Yusuf said he would examine file and as soon as he had brought himself up to date he would take necessary action by way of formal acknowledgement my letter requesting extension.

Repeated info Dhahran 145. CHILDS

'Not printed; it reported a visit by Childs and the British Ambassador to Riyadh on May 24 to inform the King of a tripartite declaration by the United States, British, and French Governments concerning security in the Near East. The two Ambassadors met separately with the King in the afternoon to present the declaration. He "appeared visibly pleased" and emphasized to Childs that "SA's great interest was to combat Communism and to take measures with US to that end." (786.56/5-2550)

The Tripartite Declaration Regarding Security in the Near East was issued after a meeting of the Foreign Ministers of the United States, United Kingdom, and France in London in May 1950. For documentation on the meetings and the Declaration, see vol. li, pp. 828 ff. A copy of the Declaration was published in the Department of State Bulletin, June 5, 1950, p. 886.

886A.10/6-2650: Despatch

The Ambassador in Saudi Arabia (Childs) to the Secretary of State

TOP SECRET JIDDA, June 26, 1950. No. 375

Ref: Embassy's telegram no. 378, June 26,1950.1 Subject: Conversation with Abdullah Effendi regarding financial

and political situation. In the course of my very extended conversation with Abdullah

Effendi, private secretary of Crown Prince Saud, he stated that the

'Not printed; It reported a conversation between Childs and Abdullah about Saudi Arabian relations with the British (786.00/6-2650).

SAUDI ARABIA

Crown Prince had asked him to inquire of me what I thought that the general financial situation, particularly in view of His Majesty's refusal to approve the budget as submitted by Shaikh Abdullah Sulai- mail, minister of Finance, and Najib Bey Salha, Assistant Deputy Minister of Finance.

I told Abdullah Effendi he might tell His Royal Highness I was very deeply disturbed about the financial situation and that he might recall I had informed His Majesty when I discussed the subject with him that while the Saud dynasty was at the present time secure, the time might come when, if the present situation were allowed to con- tinue, no one could prophesy what might happen. I added to Abdullah that I was even more concerned at the present time than I was when I had discussed the situation with the King.

Abdullah stated he was also and that he had discussed the situation repeatedly with the Crown Prince. He had urged upon the Crown Prince his responsibility in the matter and the necessity for him to press the need of reforms to the King. The Crown Prince had stated he feared the anger and displeasure of His Majesty and that the King might even go so far as to pass him over in favor of one of his other sons. Abdullah had remarked that, knowing the King's character, he would probably admire the Crown Prince's action and take it as indi- cating that he was following in his father's footsteps.

Abdullah said that the truth was that the King did not in fact have too high an opinion of the Crown Prince and he did not enjoy the cooperation of his brothers. There was certainly a gathering discontent in the country. He thought that the Crown Prince should go to Prince Faisal and Prince Mansour and persuade them to accompany him to the King to press upon the King the need for thoroughgoing financial and other reforms. Even if the Crown Prince's brothers refused to act he should take it upon himself to do so as it was definitely his responsibility. Abdullah asked what I thought. I said it was hardly appropriate for me as Ambassador to make any comment but per- sonally and in view of the deep interest I had in Saudi Arabia and the Saud family I thought his advice could not have been sounder. History was full of examples of disaster attending those who let matters drift until the situation had become so aggravated that it was incapable of normal and orderly correction. If I were the Crown Prince I would not hesitate. I would first of all endeavor to enlist the cooperation of my brothers in proposing a voluntary cut in budgetary allocations. I would then go to the King and represent the need of drastic reforms and indicate the disinterestedness of those proposing them by the voluntary offer to accept a substantial reduction in present allocations from the budget.

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FOREIGN RELATIONS, 1950, VOLUME V

Abdullah said that he would inform the Crown Prince of his ex- tremely interesting conversation with me and urged that I come to Taif and speak to the Crown Prince myself in the same sense. I said I was prepared to come to Taif but I thought it extremely unwise, for any rumors to be given currency that I was putting my head together too closely with Prince Saud. A diplomat was no diplomat who figured either prominently in the news or whose name was the subject of conversation. I thought my best contact with His Royal Highness was through Abdullah Effendi himself. I was not going on leave until July 21 and by that time His Royal Highness would be coming to Jidda on his return to Riyadh and I would be able to see him then much less conspicuously than if I went to Taif.

J. RivEs CHILDS

886A.10/6-3050

Memorandum by the Acting Secretary of State for Near Eastern, South Asian, and African Affairs (Hare) to the Assistant Secre- tary of State for Economic Affairs (Thorp)

CONFIDENTIAL WASHNGTON, June 30, 1950. This Bureau was considerably disturbed by the failure of the Board

of the Export-Import Bank to take action on the application of Saudi Arabia at the meeting held on June 29, 1950. This application has been pending since February 27, 1950; it has been thoroughly ex- amined and discussed by the Staff and Board of the Bank; and the unequivocal support of the Department has been conveyed to the Bank by Assistant Secretary McGhee at the Board meeting held on April 26, 1950. The delay appears to be explained largely by the pressure of other business, but in view of the high priority assigned to the Saudi Arabian request by the Department, and in view of the favorable report on it submitted by the Bank's Staff, doubts could be expressed as to whether this explanation meets the test of the Bank's and the Department's responsibility. The leisurely processing of the Saudi Arabian application is a source of increasing embarrassment to the Department.

It is not necessary to recount to you the critical elements of the situation which are shaping up in Saudi Arabia, including the finan- cial and budgetary crisis, the prospects of less favorable oil royalty arrangements, and reported unrest and anxiety within the Kingdom. These complications underline the urgency of prompt action on the pending application, since public knowledge of substantial U.S. sup- port of Saudi Arabia through an Eximbank loan will tend to allay

1180

the fears of insecurity, which, if not checked, could lead to damaging instability in that country. If I am correctly informed, the only re- maining significant obstacle to favorable action on the loan is the delay of the NAC Secretariat to acknowledge receipt of the Bank's letter providing information on the application, since NAC review or formal consideration was not contemplated. NEA assumes that formal approval by NAC is not necessary since according to the pro- posed terms of the loan contract with Saudi Arabia the Bank's secu- rity will be more than adequately covered by the earmarking of future oil royalties accruing to the Kingdom.

In NEA's view the above brief adds up to compelling evidence that the Department should intervene in such a manner as in your dis- cretion would quickly remove the last obstacles which are blocking final approval of the Saudi Arabian request. Therefore, NEA respect- fully requests that you, as the Alternate Member to the Secretary of State, both as respects the National Advisory Council and the Board of Directors of the Export-Import Bank, take such steps which will be calculated to accomplish the objective described."

1 For information on final approval of the loan on July 20, see editorial note, infra.

Editorial Note

A memorandum from Wilfred Malenbaum, Investment and Eco- nomic Development Staff, to John E. O'Gara, Office of the Assistant Secretary of State for Economic Affairs, dated April 25, not printed, reported the Export-Import Bank would review its policy on the ex- tension of credits to Saudi Arabia on April 26. He recommended that the Department press the Bank to approve as many of the proposed projects as practicable, since it was the opinion of the Bureau of Near Eastern, South Asian, and African Affairs that disapproval of all or a large part of the Saudi Arabian application would have a deleterious effect on United States relations with Saudi Arabia. (103-XMB/4--2550)

The Saudi Arabian application was considered by the Board of Directors of the Export-Import Bank on April 26, June 22, June 29, July 6, and July 13, but a decision was deferred, pending action by the National Advisory Council. A memorandum by Jerome J. Stenger, Office of Financial and Development Policy, Investment and Eco- nomic Development Staff, to Leroy Stinebower, dated July 18, not printed, reported that the National Advisory Council staff committee had approved Export-Import Bank consideration of the Saudi Arabian application. The National Advisory Council advised the

1181' SAUDI ARABIA

FOREIGN RELATIONS, 1950, VOLUME V

Export-Import Bank on July 21 that, through a telephone poll com- pleted that day, it unanimously approved consideration by the Bank of applications by Saudi Arabia for credits up to $15 million to finance specific projects which the Bank found economically sound. On July 20 the Export-Import Bank approved a credit of $15 million for the Saudi Arabian Government. Information on the loan is in De- partment of State files 103-XMB and NAC Files, Lot 60D137, a master file of the documents of the National Advisory Council on International Monetary and Financial Problems for the years 1945- 1958, as maintained by the Bureau of Economic Affairs of the Depart- ment of State.

Editorial Note

On July 26, 1950, the President signed Public Law 621, "An Act to Amend the Mutual Defense Assistance Act of 1949."

Congress had amended Section 408 (e) of the 1949 act to allow the President to transfer military equipment, materials, or services, at no cost to the United States, to other countries whose defense was important to the security of the United States. The section of the act relevant to Saudi Arabia's request for military equipment authorized transfers to a country not eligible to join with the United States in a collective defense and regional arrangement, but whose ability to de- fend itself or to participate in the defense of the area of which it was a part was considered important to the security of the United States. Prior to receiving any equipment or services, the recipient country was required to sign a contract to assure the United States against any loss on the transfer. (64 Stat. 373)

Representatives of the Department of State met with Defense De- partment officials on three different occasions (August 18, Septem- ber 12, and September 18) to discuss provisions the Defense Depart- ment wanted included in a proposed long-term Dhahran Airbase agree- ment and ways to implement cash reimbursable assistance for Saudi Arabia. Memoranda of those conversations are in Department of State files 711.56386A/8-1850, 786A.5/9-1250, and 786A.5/9-1850, respectively.

A declaration that Saudi Arabia was eligible under the amended Mutual Defense Assistance Act was necessary before it could obtain military aid from the United States on a reimbursable basis. On September 16, 1950, John 0. Bell, the Acting Deputy Director for Mutual Defense Assistance, asked for the opinion of the Defense Department on Saudi Arabia's eligibility for aid. In a memorandum, dated September 27, Major General Lyman L. Lemnitzer replied that

1182

SAUDI ARABIA

Saudi Arabia was eligible because it was clear that the ability of Saudi Arabia to defend itself was important to the security of the United States. -Documentation is in Department of State file 786A.5.

ss6A.1o/7-2850

Memorandum of Conversation, by the Acting Officer in Charge of Arabian Peninsula Affairs (Await)

CONFIDENTIAL [WASHINGTON,] July 28, 1950. Subject: Export-Import Bank Loan to Saudi Arabia.

Problem: Although the Bank approved a loan of $15,000,000 for Saudi Arabia

on July 20th, several details are still in a state of negotiation before it can be signed.

Action Required: None.

Summary: Mr. Snodgrass called this afternoon to brief me on the progress of

the loan agreement. Mr. Snodgrass, in his conversations with the Bank and the Saudi Arabian Ambassador,' is acting in his official ca- pacity as adviser to the Saudi Arabian Embassy for the purpose of obtaining the Export-Import Bank loan. He stated that there are now three points at issue.

The first involves evasion of the term "interest" which is unaccept- able owing to religious considerations. The expression "service charge" had been regarded as satisfactory, but the Ambassador expressed his preference yesterday for "handling commission". He is rather in- sistent on that terminology, Mr. Snodgrass reported, while the Bank prefers to keep the expression "service charge". It is a minor point and should present no real difficulty.

The second point is the grace period before repayment of the loan is to begin. The Ambassador asked for five years, the Bank offered three. There is no period generally applied to loans, but each is de- cided on its merits. The Ambassador believes Saudi Arabia should have treatment equal to the best accorded any other State. The Bank has now offered four and a half years with repayment to be in twenty- two equal semiannual installments. It should be possible to resolve this difference without too much delay.

'Asad Al-Faqih, Saudi Arabian Ambassador to the United States.

538-188--78------76

1183

FOREIGN RELATIONS, 1950, VOLUME V

The third issue is an important one. The basic form of the Export- Import Bank contract requires the contracting firm on a project to be jointly responsible with the borrowing Government, for proper ex- penditure of the funds extended by the Bank. Mr. Snodgrass, in view of Bechtel's poor experience with the Saudi Arabian Government on financial matters, has suggested the money be paid into a Bechtel ac- count for the Saudi Arabian Government, in order to obviate depend- ence upon the Saudi Arabian Government for drawing on the funds. The Ambassador is adamant that the credits should be extended to the Saudi Arabian Ministry of Finance who will disburse them as needed. I told Mr. Snodgrass that I could appreciate the motives of both sides on this issue, but felt it would be impossible for the Saudi Arabian Government to give way. I asked if it would be possible to open a joint account requiring signatures from both parties for draw- ing on it. He agreed that that might be a workable compromise.

Mr. Snodgrass also stated that Sheikh Asad did not want to be responsible for the proceeds of the loan in any way and was suggesting to his Government that a special officer from the Ministry of Finance should be attached to his Embassy to be signing officer for all expendi- tures under the loan.

Editorial Note

On August 11, 1950, in a letter to the Secretary of State, not printed, the Secretary of Defense transmitted the proposed military assistance program of the Department of Defense for Saudi Arabia. He reported the Joint Chiefs of Staff had scaled down the program proposed in the O'Keefe Report because the high cost would be likely to have an adverse effect on the Saudi Arabian economy and because the time required to train Saudi Arabian personnel to handle the equipment might lead to deterioration of valuable equipment before it could be effectively utilized. He added, however, that "in view of the impor- tance of securing long-term rights at Dhahran Air Base, it is believed that the program recommended herein should be modified upward if such action is essential to accomplish this." The program recommended by the Joint Chiefs of Staff called for an expenditure of $75,765,648 by Saudi Arabia to equip a military force consisting of 18,085 officers and men in the army, 108 in the air force, and 265 in the navy. (786A.5/8-1150)

Colonel R. D. Wentworth, U.S.A.F., Department of Defense liaison officer with the Department of State on the negotiation of the Dhahran Airfield Agreement, sent a summary of the Joint Chiefs of Staff

1184

recommendations to Ambassador-designate Hare in a memorandum, not printed, on September 28. (786A.5/9-2850)

786A.00/9-350: Telegram

The Chargg in Saudi Arabia (Hill) to the Secretary of State

SECRET rIoRITY JiDDA, September 3, 1950-4 p. m. 127. Immediately preceding Embtel 126 1 is factual report Riyadh

visit and was repeated Dhahran. Following observations made to Department only:

I consider it most unfortunate that subject of military aid for SA was brought up at this time. This is practically the keystone our present relations with SA and is vitally connected future negotiations long term DAF agreement. This subject is top level importance and should if possible be handled only by chief of mission after carefully conceived plan of action.

It is elementarily obvious that O'Keefe could not call on King and discuss subject described without immediately reopening delicate ques- tion of military aid and this is exactly what happened. I am surprised that matter of this importance and potential reactions was not fully discussed by USAF with Department and mutually cleared and De- partment's instructions issued before we acted.2

Furthermore I fail see what was the necessity our having audience with King. Fuel tank proposition was discussed in Riyadh by Am- bassador Childs with YYa when he making good-bye visit and YY indicated there probably would be no difficulty and Ambassador so informed O'Keefe. The activities US soldiers is within terms DAF agreement article 16 and simple notification would have sufficed if even that was deemed necessary.

Likewise bomb storage proposal is logical move these days and would have surprised no one. It could have been taken up casually by Foreign Office note and without fanfare. Although this subject

'Not printed; it reported a visit by Hill and O'Keefe to Riyadh on September 2, during which O'Keefe requested permission for the U.S. Air Force to store 5,000 tons of ordinary bombs at Dhahran Airfield, set up a rifle range and bring in more small arms, and construct an underground fuel tank. His request brought immediate complaints from the King and Yassin that the United States was only interested in protecting the Dhahran Airfield and Saudi Arabian oil wells. They then repeated their requests for American arms. (786A.00/9-.50) .

" Telegram 76, August 29, from Washington, answering a query from Jidda, had informed the Embassy that O'Keefe's request for an audience with the King was "presumably on subject creation bomb dump DAB." (786A.56/8-2950)

Yusuf Yassin, Acting Foreign Minister.

1185SAUDI ARABIA

FOREIGN RELATIONS, 1950, VOLUME V

started with Top Secret classification it is now known to usual Palace group including interpreters.

Only encouraging feature during audience was that King main- tained friendly attitude throughout never losing temper or speaking harshly. Even when making some of his strongest statements he looked at me and spoke smilingly as if seeking assurance his remarks. being understood and not rousing fears. This created instinctive im- pression that despite his disappointment that USG has so far failed to meet his requests he realizes he has at present no better alternative than to go along with US. * Neverthless I wish to assure Department that the much worn theme.

of the "O'Keefe report still being studied in Washington" is rapidly becoming unpleasant to Saudi ears and they beginning consider it. as delaying tactics and double talk on our part.

New subject: towards end of audience King said that Aramco also, not cooperating with him completely and that he does not believe. anything they say. He said even on purchases made for him they charge him "ten times as much as cost." I replied that if His Majesty would permit me to say so in my opinion Aramco had pursued a very honorable and honest course with SA.

Further details by despatch. HILL.

786A.56/9-350: Telegram

The Acting Secretary of State to the Embassy in Saudi Arabia

TOP SECRET WASHINGTON, September 12, 1950-11 p. m. 90. Embtels 126 1 and 127, Sep 3.2 Defense and Dept understood.

O'Keefe planned to raise single subject of creation bomb dump DAB, (Deptel 76, Aug 29 3). In view Embdesp 29, Jul 20,4 it was thought

King might welcome measure. It might also be assumed training ac- tivities and fuel tank wld be similarly considered by SAG.

Dept believes it might be useful 1) to recall Collins'5 and McGhee's6 conversations earlier this year, which were followed by temporary DAB extension to Feb 1, 1951, and 2) to emphasize that USG now has question cash reimbursable mil assist under serious consideration.

7

Not printed, but see footnote 1, psvra. 'Suvra. - 'Not printed, but see footnote 2, s8vra. 'Not printed; it reported a meeting in which the King asked if Dhahran Air-

field had sufficient military equipment to defend itself (786A.5/7-2050). For an account of Collins' visit, see excerpt of his report, p. 1158.

' For an account of McGhee's vist, seep. 1131. ' For information on cash reimbursable military assistance, see editorial note,

p. 1182.

1186

SAUDI ARABIA

At same time, Dept appreciates depth of SAG feeling re this question but believes SAG may not fully realize numerous steps required within USG before it may be in position definitively to negotiate with SAG.

In view remarks by King and Sheikh Yusuf reported Deptel [Emb- tel] 126, Sep 3, Dept considers you shld take early opportunity to hint to SAG that 1) since signature MDAP legislation by Pres Jul 26, real progress has been made by Defense and State on plan for reim- bursable mil assist and 2) Amb Hare hopes following his arrival SA " to commence discussions on this subject as well as DAB. You shld not, however, commit USG or Amb Hare in any way.

FYI, JCS recommendations have been recd. USAF now preparing draft DAB agreement. Dept now seeking designation SA as eligible under MDAP legislation (Public Law 621) for cash reimbursable mil assist.

WEBB

J. Rives Childs, United States Ambassador to Saudi Arabia and Minister to Yemen since 1946, submitted his resignation from those posts on July 7, 1950. He left Jidda on July 21 for leave in Europe before returning to the United States, and Heyward G. Hill assumed charge of the Embassy until the arrival of the new Ambassador.

President Truman approved Childs' resignation on August 1. An announcement is in the Department of State Bulletin, September 25, 1950, p. 516. On August 28, 1950, the White House publicly announced the appointment of Raymond A. Hare as the new Ambassador. Hare arrived in Jidda on October 19 and presented his credentials at the court in Riyadh on October 24.

7S6A.00/9-1950: Telegram

Counselor of the Embassy in Saudi Arabia (Hill) to the Secretary of State

SECRET JIDDA, September 19, 1950-8 p. m. 160. Prince Feisal came to Jidda this afternoon from Mecca and

shortly afterwards Foreign Office called to say he wanted me come see him at 4: 30.

Meeting was at Foreign Office, with Prince Mansour and Tahir Bey in attendance.

Feisal said that reason he sent for me was because after our con- versations Riyadh September 2,1 His Majesty had formulated his reply and not wishing to send it by telegram or to call me back to Riyadh to receive it, His Majesty had instructed him to communicate it to me personally, in view its confidential nature. Feisal explained he been unable come to Jidda sooner because of illness, and had arrived in Mecca from Haifa only last night. Said he came Jidda for this pur-

1 See telegram 127, September 3, p. 1185.

1187

FOREIGN RELATIONS, 1950, VOLUME V

pose and would return Mecca immediately after our talk and Prince Saud giving big reception there tonight for pilgrim leaders. He added that in order not to delay work at airfield he had already informed O'Keefe personally of the message.

Prince Feisal then read message and handed me copy, translation of which follows:

[Here follows the message, not printed, expressing the King's de- sire to base his Government's action regarding defense of the Dhahran Airfield on the overall defense needs of Saudi Arabia.]

This seemed auspicious occasion to convey thoughts Deptel 90, Sep- tember 12.2 I stated Department had informed me that President Truman had signed MDAP legislation on July 26 and that defense progress had been made since then on plans for granting reimbursable military assistance to Saudi Arabia. Feisal interrupted to say that instead of "reimbursable military assistance to Saudi Arabia" we should say "military equipment sold to Saudi Arabia". When he said this, Prince Mansour, who is usually immobile and expressionless, shrugged his shoulders and made a discouraged gesture.

I continued by saying that Ambassdor Hare hopes shortly after his arrival to begin discussions on this subject and also on DAF. I made no commitments of -any sort nor were any requested.

In spite of fact that Ambassador Childs repeatedly made it clear to SAG that military aid would have to be reimbursable (Embdesp 197, June 14 2) it is obvious that this thought is extremely distasteful to them and that they personally feel they are entitled to some free military assistance in form of arms. It would appear likely that these sentiments may cause a major obstacle in negotiations long term DAF agreement as I believe their pride also deeply concerned here and perhaps more important to them than monetary considera- tions. No doubt Department already giving serious consideration all such factors in connection with plans for long term agreement.

I did not inquire of Mansour anything about munitions factory development (Embtel 159, September 19 4) as he did not raise subject and because I was not in position offer any proposal in lieu thereof had he broached such inquiry in reply.

Repeated info Dhahran 81. HILL

'Supra. 'The reference appears to be an error. The message cited cannot be further

Identified. ' Not printed. Hill reported that Najib Salha told him Prince Mansour was

negotiating with two French officers about SAG plans to set up a munitions factory to produce both rifle cartridges and small shells. Najib said Mansour had decided the Saudi Arabian Government could wait no longer for military assist- ance from the United States. (7860A.00/9-1950).

1188

SAUDI ARABIA

986A.524/9-1950

Memorandum by Mr. Robert Thayer of the Bureau of Near Eastern, South Asian, and African Affairs to the Ambassador-Designate to Saudi Arabia (Hare)

SECRET [WASHINGTON,] September 19, 1950. Dhahran Airbase is for the most part a civil airport. As you know,

it is used extensively by civil aircraft in transit on routes between the Near East and South Asia. The field is located on the normal great circle route between points in the Near East such as Cairo and points in Pakistan and India.

It has never been clear to me whether the desire of the USAF to retain control over the operation of the field is necessitated by the fact that the Saudis are technically and financially incapable of operating it themselves or whether USAF operational control is made necessary by virtue of the possibility of having to mount combat air operations from the base. If the latter, I would expect that in the event of an emergency, civil aircraft would be excluded from the field. If, on the other hand, inability of SAG to operate the base is the reason for USAF retention of control, it seems to me that we should approach the problem of a long term agreement on a somewhat different basis than has been the case in the past.

In that event, I believe that we would wish to recognize the fact that 90% of the operations at Dhahran are civil operations, and that the problem before us can be stated as follows:

"How should the U.S. assist the SAG to operate the civil airfield of Dhahran and how can we best retain the right to conduct necessary military air operations at the field ?"

The SAG holds title to Dhahran and it follows that the SAG is within its sovereign rights in retaining operational and administra- tive control over the entire base if it so chooses. The SAG appears unwilling to enter into a formal agreement which gives up this right even though they are prepared to relinquish it in fact through the device of a jointly appointed administrator in the person of General O'Keefe. The problem is not one of attempting to define the area of responsibility and authority of the SAG as against the USAF. The existing agreement attempts to do this although it is an accepted fact that an airport cannot be safely and efficiently administered and op- erated under dual authority.

I suggest, therefore, that providing the Air Force concurs, we call a spade a spade and formally acknowledge the full sovereignty of the SAG over Dhahran with all that it implies. We should then insist, that in view of the inability of SAG to operate the field that the two

1189

FOREIGN RELATIONS, 1950, VOLUME V

governments enter into partnership by jointly appointing a mutually acceptable Administrator of the field. During the period of existing military requirements this individual would, of course, be the Com- manding Officer at Dhahran. At some future date he might well be a civilian, perhaps a firm such as the private company which ran Kimpo Airfield in Korea under contract with the ECA and CAA, or an in- dividual who might be employed by the SAG. I strongly recommend that we try to provide for the future through such an arrangement. It is always possible that at some future date Dhahran might not be of suflicint military importance as to justify the large expenditures from the military budget which are required to maintain and operate this essentially civilian airport.

711.56386A/10-3050

President Truman to King Abdul Aziz Ibn Saud of Saudi Arabia'

SECRET [VASHINGTON,] October 31, 1950.

YouR MAJESTY: Upon sending to you my new Ambassador to reside near your Court, I wish to take occasion to renew to Your Majesty expressions of my sincere and lasting friendship toward your- self, the Royal Family and your people.

Your steadfast loyalty and good will, alike in times of stress as in days of happiness and well-being, have ever been sources of pride and pleasure to me and to the American people. Our countries have been comrades in arms together and we have common cause in opposing the godless forces of Communism which are endeavoring to destroy free- dom throughout the world. I count it a high tribute to the United States to have support of so illustrious a warrier as yourself in this struggle.

The efforts you are making to develop your country and improve the standards of living for your people are admirable and praise-

'A draft of the source text was attached to a memorandum from McGhee to the Secretary of State, dated October 24, not printed, with a recommendation that the Secretary send it to the White House for the President's signature. The letter was prepared for Ambassador Hare to present to the King soon after he pre- sented his credentials and before he began negotiations for a renewal of the Dhahran Airfield Agreement. (711.56386A/10-2450)

The Secretary transmitted the letter to the President with a memorandum, dated October 30, not printed, with a recommendation that the President sign it. The President signed the letter on October 31 and William J. Hopkins, Execu- tive Clerk, sent it back to the Secretary attached to a memorandum, not printed, for Ambassador Hare. (711.56386A/10-3050)

The Secretary transmitted the letter to Ambassador Hare in Jidda as an en- ,closure to Instruction 15, not printed. Hare was instructed to inform the King orally that he might make public use of the letter if he wished. (711.56386A/ 11-350) In telegram 400, December 24, from Jidda, p. 1197, he reported presenting the President's letter to the King in December.

1190

SAUDI ARABIA 1191

worthy. I am proud that American enterprise has been able to assist you in such worthy projects.

I wish to renew to Your Majesty the assurances which have been made to you several times in the past, that the United States is inter- ested in the preservation of the independence and territorial integrity of Saudi Arabia. No threat to your Kingdom could occur which would not be a matter of immediate concern to the United States.

The health of Your Majesty is a subject of no less importance and I pray that you will be long preserved for the welfare of your country and the happiness of your people.

2

Faithfully yours, HARRY S. TRuMAN

I A translation of the King's letter of reply to President Truman, dated Riyadh, January 14, 1951, together with the original in Arabic, was transmitted to the- Department as an enclosure to despatch 250 from Jidda, February 1, 1951 (711.56386A/2-1551). The King's reply was forwarded to the President on Feb- ruary 27 under cover of a memorandum by Acting Secretary Webb (711.56386A/ 2-1551).

786A.5/11-450: Telegram

The Ambassador in Saudi Arabia (Hare) to the Secretary of State

TOP SECRET PRIORITY JIDDA, November 4, 1950-3 p. m. 270. Deptel 149 October 31.1 It is unanimous opinion here that

anything which could be done to simplify requirements would be highly desirable for following reasons:

1. Despite our maintenance consistent position on cash reimbursable- feature of aid Saudis feel they are entitled to grant aid (a) because. they have clearly professed their desire to have us as their "next. friend" and feel that such a policy entitles them to treatment com- parable to that we have accorded other countries such as Iran in which we have a close interest (aside from practical aspects, there is also, considerable degree amour propre in this contention), (b) because Saudis gave us DAB rights without demanding compensation and. feel gesture of comparable liberality on our part would be in order,. and (o) because they maintain inability to pay due to financial strin- gency. We of course have arguments prepared to rebut these asser- tions which we hope will be effective in bringing Saudis around to, our point of view but debate promises to be spirited and insistence on acceptance our demands in a highly formalized and detailed agree- ment might be straw that would break the camel's back.

2. Immediate consideration aside, aversion of Saudis in principle to detailed formal agreements is well known phenomenon as pending- negotiations on TWA, civil air rights and FCN bear witness. Gen-

'Not printed; it informed the Embassy that Saudi Arabia had been officially designated eligible for cash reimbursable military assistance on October 26 and said that some modification of the requirements might be desirable "considering special nature SA case." (786A.5--MAP/10-3150)

1192 FOREIGN RELATIONS, 1950, VOLUME V

,erally speaking Saudis take view that if intent is right details can be worked out satisfactorily but that without good will detailed under- takings on paper are unavailing.

Foregoing picture would of course be changed entirely if we were :able on our part to assume an obligation in the agreement which would satisfy Saudis desire for security assurances by US. I take it however that best we can hope to do along this line in existing cir- .cumstances is something in nature of proposed letter of President.

In addition foregoing general comments we would specifically rec- ommend that agreement should if possible take form of an exchange .of notes covering basic requirements in simplest language. Our read- ing of MD 5/3 2 leads to conclusion that fundamentals are neither numerous nor complicated nor that they would be objectionable to -SAG if properly presented.

Re payment terms Embassy suggests most inadvisable to present on 'eash on barrel head" basis. Fact is that our offer of military aid is

:intended inter alia to have political overtones designed to make Saudis more responsible DAB lease. Thus it is important that gesture should -not appear niggardly. Section IV, B, 1, of MD-5/3 appears to afford -considerable latitude in this regard and it is believed that financial position of SAG sufficiently sound to permit considerable degree of liberality in guarantee payment.

Repeated information Dhahran 142 for General O'Keefe. HARE

2 The editors have been unable to identify this reference.

886A.10/11-450: Telegram

The Ambassador in Saudi Arabia (Hare) to the Secretary of State

:SECRET JIDDA, November 4, 1950-8 p. m. 274. Following week-long meeting Riyadh of top Saudi officials

including princes, FinMin and Najib Salha, latter returned Jidda Thursday and informs following decisions taken:

1. Introduce income tax SA along lines Treasury proposals of Sep- tember. Decree this subject to be published tomorrow.

2. Establish "accounting department" Riyadh directly under King to prepare budget, oversee SAG finances. To assist here Salha wants two trained American accountants, to which King agreed in writing and for which Salha will apply under Point IV soonest. Embassy yet not perfectly clear as to scope proposed new office, but believes per- haps similar to Budget Bureau. In any event feel top priority should be assigned getting these experts to SA once formal request received.

SAUDI ARABIA

Prior efforts to line up personnel would be appreciated. Saliha stated AUB graduates would be hired assist these Americans.

3. King also reportedly agreed to American experts for customs and for FinMin, and Salha informs he will request two US customs experts and one financial-monetary expert under Point IV in addition to those paragraph 2.

Queried as to reason this sudden "coming of age" SAG, Salha stated King and princes impressed by what had been done so far (by him) to introduce order in SA finances and reduce waste, and felt now with income running high and expenses becoming increasingly manageable was time to introduce further steps required by more complicated financial problems created. Also said YY had faithfully reported King my observations on SA finances (Embtel 272, Novem- ber 41), that leaky faucet figure of speech had caught King's imagi- nation and that timing just prior Salha's arrival Riyadh had been fortunate coincidence. Salha added members royal family had indi- cated they now willing live within given budget. Also appears star free-spending Shaikh Abdullah perhaps descending for moment, while Salha appears to have returned with more duty than heretofore. FinMin has returned to his fishing camp 50 miles south Jidda, leaving Salha in complete charge here. If, as indicated by latter, FinMin's role in coming Aramco talks is to be intermittent, while Prince Feisal heads delegation, further indication his eclipse will have been provided.

*While foregoing still partly in talking stage and we feel all talk SAG financial reforms should be viewed with caution, information furnished by Salha concerning King's new willingness have budget, foreign experts and income tax indicates definite forward steps in Saudi governmental structure are planned. Salha says he told King if such measures taken and Americans secured, USG would be more sympathetic any subsequent requests based on financial troubles, but that we would do nothing as long as existing profligacy and mis- management continued. Embassy feels every effort should be made by USG take advantage this new turn events to ultimate benefit ourselves as well as SAG. Further developments will be reported and formal SAG requests transmitted soon as received.

Sent London pass Cairo 42 for Parker. HARE

1 Not printed; it discussed the Saudi Arabian financial situation as it related to demands being made on Aramco. Hare informed the Department he had "com- pared the situation to a leaking faucet on a water tank. It would be a poor way to correct the continual loss of water merely by pouring in more water and not fixing the wasteful leak." (886A.2553/11-450)

.1193

FOREIGN RELATIONS, 1950, VOLUME V"

711.56386A/11-1750

The Secretary of State to the Ambassador in Saudi Arabia (Hare)

SECRET WASHINGTON, November 17, 1950. No. 19

Sin: The Secretary of State transmits for your attention the ap- proved draft of the proposed long term Dhahran Air Field Agree- ment ' for negotiation with the Saudi Arabian Government. Although the proposed agreement is essentially for military purposes, the im- portance of the civilian aspects of the Dhahran Air Field are obvious and it is accordingly suggested that you may wish to invite the Civilian Air Attach6 resident at Cairo to assist you in these negotiations. You are hereby authorized to initiate negotiations at a time to be decided in agreement with the Saudi Arabian Government.

An effort has been made to stress the idea of partnership and mutuality of interest in the utilization of the Dhahran Air Field and toward this end a preamble has been drafted to set the tone for the agreement generally. Every opportunity is made in subsequent articles to stress the joint aspect or to emphasize that derivation of our rights and privileges at the Air Field is by specific agreement with the Saudi Arabian Government. To the greatest extent possible the terms of the existing agreement have been preserved. Modifications have been made for the most part only in those instances where long term interests require changes. Every effort has been made throughout, however, to maintain brevity and clarity in keeping with the expressed wishes of the Saudi Arabian Government.

[Here follows an explanation of the various articles of the draft and a comparison with the terms of the existing agreement.]

For the Secretary of State: G. LEWIS JONES

Director Ofce of Near Eatern Affairs

%Not printed (711.56386A/11-1750). Further details on the negotiations and terms of the treaty are scheduled for publication in a forthcoming volume of Foreign Relations.

786A.5-MAP/11-2150: Telegram

The Secretary of State to the Embassy in Saudi Arabia

TOP SECRET WASHINGTON, November 21, 1950-5 p. m. 180. Emb will be advised date notification to Cong Comites of

designation SA as eligible cash reimbursable mil assistance, re Deptel

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SAUDI ARABIA

171, Nov 15.1 Emb shld simultaneously notify SAG. Ertb also au- thorized as of that date institute negots extension this aid.

2

FYI fol is substance of note which shld be submitted SAG at appropriate time setting forth minimum requirements for extension assistance.

"Re request of Govt SA for trans of certain items of mil supplies and equipment, there are certain assurances and understandings which US Govt is required obtain from ur Govt before completing any transaction under section 408(e) of Mutual Defense Assistance Act of 1949 (Public Law 329, 81st Congress) as amended by Public Law 621, 81st Congress.

"I understand ur Govt is prepared to agree to use such items as may be provided to foster internatl peace and security within framework of Charter of UN; and moreover, that the items to be provided by US Govt are required by SAG to maintain its internal security, its legitimate self-defense or permit it to participate in the defense of the area of which it is a part, and that it will not undertake any act of aggression against any other state.

"I understand also that your Government will obtain the consent of the Govt of the US prior to the trans of title to or possession of any equipment, materials, info, or services furnished, and that ur Govt will take measures to protect the security of any article, service, or info furnished.

"In order pay for mil assistance, SAG will open an irrevocable ltr of credit in favor of SecState in US bank for full cost including ac- cessorial and administrative expenses incident thereto of each order equipment to be purchased when order made. Drafts on this ltr pay- able Treasurer of US will be drawn before equipment out of USG stock is transferred to SAG. Re equipment for which orders must be placed with manufacturers, contracts will be placed in behalf SAG by agency USG. Payment for such equipment must therefore be ar- ranged in advance in same manner outlined above including such amounts as may be required to defray progress payments on contract and plus the estimated cost of damages resulting from possible can- ,cellation of contract by the SAG. Increments necessary cover possible damages will be applied toward final payment under contract. Any remaining funds will be returned SAG.

"The Govt of SA will also understand that the Govt of US neces- sarily retains the privilege of diverting items of equipment or of not

1 Not printed; it informed the Embassy that the final instructions on military assistance were being prepared, and promised to consider the Embassy's sugges- tion on lending equipment to Saudi Arabia (786A.5-MAP/11-1550). Further information on cash reimbursable military assistance is in the editorial note,. p. 1182.

Telegram 188, November 29, from Washington, not printed, authorized the Ambassador to begin negotiations with the Saudi Arabian Government on cash reimbursable military assistance. Negotiations for military aid were to be carried .n simultaneously with negotiations for the new Dhahran Airfield Agreement. (786A,5-MAP/11-2950)

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FOREIGN RELATIONS, 1950, VOLUME V

completing-ervices undertaken, if such action is dictated by considera- tions of national interest.

"A reply by the Govt of SA to the effect that these understandings are correct will be considered as constituting an agreement between our two Govts."

Dept aware payment scheme undoubtedly unpalatable SAG, but law stringent re this point and above payment scheme least burdensome legally possible. Might be helpful cite recent example advance SAG payments to UK for arms.

Acx~soN

886A.13/12-650: Telegram

The Acting Secretary of State to the Embassy in Saudi Arabia'

CONIMDENTIAL WASHINGTON, December 18, 1950-2 p. m. 215. Embtels 359 Dee 6,12 352 Dee 4,1 and previous tels same subj.

Dept discussed subj reference tels with Treas and Bureau of Budget. SAG request five experts approved in principle and prelim efforts being made find personnel. To obtain final approval request and re- cruit personnel, further info needed re terms of reference for experts. Dept believes experts shld serve in advisory capacity and not assume responsibility execution or admin their recommendation. Discuss above with SAG and transmit its and your comments Dept.

Difficulty anticipated obtaining experts due scarcity technically competent individuals plus doubts SAG will undertake reforms which by nature require self-discipline. Another serious determent is critical housing situation in SA. SAG will be expected provide suitable living qtrs, transportation and other facilities and necessary to obtain assur- ances they will do so. Dept wld also appreciate Emb's views re feasi- bility of accountants and possibly their families living in Riyadh for extended period in view unfavorable living conditions there.

WEBR

Repeated to the Embassy in Cairo for Parker.

2 Not printed; Hare stressed the importance of the early selection of a quali- fied currency expert for Saudi Arabia (886A.13/12-650).

"Not printed; it relayed a request from the Ministry of Finance for five Ameri- can experts under Point Four-two experts for customs organization, two to organize accounting procedures at the Ministry of Finance, and one for currency and coinage questions (886A.OOTA/12-450).

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SAUDI ARABIA

711.56386A/12-2450: Telegram

The Ambassador in Saudi Arabia (Hare) to the Secretary of State

SECRET NIACT JIDDA, December 24, 1950-noon. 400. Arrived Riyadh December 141 with General O'Keefe. General

Day 2 joined us December 17. Returned Jidda yesterday December 23. on understanding would return December 30 to continue drafting.

First item on agenda was presentation of President's letter 3 to. King who greatly pleased and said appropriate reply would be pre- pared. Later advised him not intended publication now but would' contemplate doing so at appropriate time later.

The King did not undertake to discuss either military assistance or DAF other than remark that latter was subject upon which he wishedi agreement reached without delay. He then appointed Yusuf Yassin, and Khalid Bey Gargani to negotiate behalf SAG.

Next few days devoted to our presentation military assistance and DAF proposals and general discussion with Saudi representatives who. indicated disposition reach agreement re both but emphasized im- mediate problem in both cases was how overcome King's strong feel-- ings that aid should have been on grant rather than cash basis, whereas re DAF principle difficulty was King's sensitiveness to both domestic and outside criticism for having acted to detriment Saudi sovereignty. Problem therefore was find counterbalancing factors and also pre- sent both matters in such way as to make appear that SA had made good bargain. Saudi negotiators repeatedly said in time war all SA would be at disposal US but in time peace political factors necessarily loomed large.

I believe presentation basic problem by Saudis reasonably accurate but, of course, it gave them good cover for hard bargaining which they did not fail exploit. Should be noted here that chief Saudi spokesman was Yusuf Yassin who reputed for his exasperating nego- tiation tactics and in this case he turned in star performance. Against. background of practically no knowledge of subject he attempted re-

'Telegram 391, December 13, from Jidda, not printed, informed the Depart-

ment of State that the Ambassador would proceed to Riyadh on December 14 to begin negotiations on the Dhahran Airfield Agreement and military assistance (711.56386A/12-1350).

Despatch 202, December 23, from Jidda, not printed, contained a complete account of the negotiations. Enclosed with the despatch were a chronology of the meetings at Riyadh from December 14-23, an undated copy of a Saudi Arabian counterdraft of the Agreement, and a tentatively agreed draft of the first few articles of the Agreement. (786A.5/12-2350)

'Brig. Gen. Edwin M. Day, USAF, who was to assume command of Dhahran Airfield in February 1951.

' Dated October 31, p. 1190.

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FOREIGN RELATIONS, 1950, VOLUME V

write practically entire draft and out-Shylocked Shylock in endeavor exact more than pound of flesh on each point. Further complication lay in fact that group of similarly uninformed members of King's entourage, including Prince Abdullah, were constantly injecting them- selves into matter behind scenes and that Fuad Hamza, only man with knowledge of subject, was absent from Riyadh. As consequence for first week can be said Saudi tactics were on horse-trading rather than negotiation level.

Re military assistance discussion was relatively brief and devoted largely to trying to get greatest concessions on training; to get assur- ances of advantageous price; to seek some method for long-term credit, to obtain advance delivery of arms for storage pending purchase, and to obtain general assurance arms not specified in program would be available on request. After our initial presentation Saudi negotiators appeared convinced on cash-reimbursable character of aid but seemed find it difficult understand other aspects also had legal limitations.

On DAF agreement pressure was much greater and Yusuf Yassin was at his petty-fogging worst. Following are some of points which he merged:

1. King's sensitiveness re giving civil air jurisdiction of DAF to US military commander and also giving rights to US Government as such (see following telegram) .4

2. Attempt to transform any rights sought by us into mutual obli- gations in which we would be giving more than receiving.

4. [sic] Insistence that rights given to us would be fully exercised for full term of agreement.

5. Lack of appreciation our requirements and concentration on ex- actly maximum advantage for SAG.

6. Suspicion that agreement as drafted did not reveal our true intentions.

7. Desire restrict agreement to DAF within clearly defined limits of [garble] and to reserve off-field rights for separate handling.

8. Insistence on discussing details having no place in an over-all agreement.

As result these tactics Yusuf Yassin (Khalid Bey seemed quite friendly and reasonable throughout) we found ourselves in position where at end eighth day we had only discussed five articles despite repeated insistence American group that we first review American draft and tentative Saudi draft so as to determine area of agreement

'Telegram 401, December 24, from Jidda, not printed, reported that the King was sensitive to the reflection on his sovereignty implied in giving rights to a United States military unit "as had been previously done by specifically delegat- ing SAG civil air jurisdiction to 'commander Dhahran airfield.' " (711.56386A/ 12-2450)

1198

SAUDI ARABIA 1199

and points on which discussion required. At this point Prince Mansour, Minister Defense, suddenly appeared on scene to head Saudi delegation with result that remaining twenty articles were reviewed in single day and opportunity afforded assess problem as whole (we were later told that this development occurred as result of reports reaching King re- garding Yusuf Yassin's tactics and our dissatisfaction therewith).

As matter stands following [garblel of estimate situation re DAF agreement:

1. King wants agreement and his entourage are taking cue from him but nevertheless putting troublesome finger in pie.

2. Fact that agreement is for 25 years makes Saudis understand- ably cautious especially bearing in mind their own feeling of incom- petence in matters this kind and example of unfortunate British experience in Egypt and Iraq.

3. So far tentative drafting only done on first five articles and if Saudis insist on discussion in such detail as heretofore vork to be done will be exceedingly burdensome and time-consuming with result additional extension present agreement probably necessary.

4. Although list of problems long and items complex, chances for eventual agreement barring unforeseen developments are good. This estimate is based upon attitude of His Majesty, statement of Saudi representatives even in midst most difficult discussion and statement made to me by Prince Mansour while we were returning by plane together from Riyadh yesterday.

5. The one immediate hurdle which has to be surmounted is action by Department and Defense on suggestion regarding use of training mission (see Embtel 401 December 24)5 as means playing down for public relations reasons military character of DAF agreement. Prompt action on this point is essential, since without it we are unable to continue constructive discussions with SAG negotiators.

Prospects are also favorable on military assistance proposal. One of first things which Prince Mansour did on assuming charge of nego- tiations was specifically to say SAG approved JCS recommendations in principle but also on assumption that further requests would be cooperatively entertained, especially as regards (1) combat planes situation, (2) basic workshops and training therefor; and (3) in- creased supplies of ammunition and spare parts. He also expressed hope that first group of military experts would be able help in drawing up military budget. Present situation is that draft note including ob- ligations of SAG as specified in Deptel 180, November 21 0 and also

It informed the Department of State the Saudi Arabians found the title "commander, DAF" objectionable, and the Ambassador wanted permission to substitute the title "chief, training mission" wherever reference was made to the base commander. Since the established Saudi Arabian training mission at Dhahran was a subordinate unit, he saw no reason why the title change could not be made, especially since "outcome present negotiations hinges on this issue."

'Ante, p. 1194.

538-188-7S-77

1200 FOREIGN RELATIONS, 1950, VOLUME V

some friendly phrases designed appeal SAG susceptibilities under dis- cussion with Yusuf Yassin who characteristically has put forward not only unacceptable but practically unintelligible revision our draft but believes this situation can be met with mixture of firmness and patience.

We left Riyadh yesterday on understanding that we would return by December 30 to endeavor complete drafting on both DAF and military assistance agreement following reference of "mission concept" to Department for expression views (see Embtel 401, December 24).

Chronological account discussions to date together with pertinent drafts being forwarded by pouch.

I have suggested that if possible Major Napper return Washington immediately in order give first-hand account of problem as revealed during first phase negotiations. In so doing I desire express great appreciation for most helpful services he rendered in Riyadh.

HARE