Created: 2/15/1959

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Wo arrived in Rone onxid during our visit wore entertslnod by tho Pranob AjrVWjsador to Italy, Ambassador Felewski, also by ourAmbassador to Italy and Prance, Jainea Dunn, snd Count Crespi.

Wa also mat high officials of the Vatican.

Onh of February, Ambeaaador Palewakiarty for us at his residence, the Palaia Ferness, which was designed by Michelangelo and Is one of the mostpoleces In the world.' Among bis guests were the ex-presldent of Italy, two Italian cabinet ministers and the Belgien Ambassador to Italy.

The next day, we flsw to Cairo where our Ambassador, the Honorable Raymond A. Hare,inner party for1 us. Among his guests was Prof. Fakerl, professor of history et Cairo University, who told us that during the wintere had been Invltod by the Red Chinese Government toourss Ln Egyptian history at the University of Peking. Prof. Fakerl said .that be was dasply Impressed by the brilliant minds of the Chinese people and by their oapsolty and willingness for hard work. He described hia lecturoa at the University of Peking aa being saoh of three hours' duration and given fiveeek.

Prof. Fakerl said that tha Chinese studentsneveround, and asked extremely inter-questions after

The first leoture that he gave was also attendedha leading Chinese philosopher and professor ofiterature at the University of Peking, who satowed position throughout tha lecture. Prof. Fakerl asked tho Chinese philosopher to "please not sit lns ltho should bow before you because It Is such en honor to have you present". However, the Chineserofessor replied, "No, itho must bow before you -end your wisdom". onder If lt would be possible for you to explain to tho students in the evenings.the art'of your country". After that. Prof. Fakerl said that ho taught Egyptian art ln the evenings, in sddltlon to his othor assignment.

Inew years before. Prof. Fakerl had taught Egyptian history at Tale,isiting professor, but after two months he resigned because so few of the students wore Interested.

Prof. Fakerl traveled throughout China and hla Impression was that the people workurpose and hovereat dealhort time. He was full of

admiration for the Chinese nil's sums end libraries and the way that all their works of 'art'bad'bean

Rone and Cairo are the two great souroes ofas to what .may be expectedhe future. "

Consolidating all the informationas able toave corns to ths following ooncluslonsi

here will- be no world war over Berlin.-Tension will be renewed In the Middle Sast before this year is out and it isthe next major Soviet move will take place.' In the Middle East, the United Statss is not precisely committed to Immediate Intervention; also, it would be extremely dlffloult for America, to inter-veno effectively;

Our trouble ln Berlin Is being aggravated bv the weakness-of the English. Tho Russians cry "Trade andhe East Garrasn Communists say "Get your governmentrecognize us and there are fat orders awaiting". The British are not the only people Influenced by this insidious Tneha Belgians and even the Wost Germans, with steel mills-slowed down and coal mines shut down, are tsklng the bait. One British business-man said, "Who wants to go to war for Berlin? As farmon't care If Germany la never reunited". These sentiments are music to the ears of the East Germans, for Oerman unity is the last thing that they want.


It la thought that Russia will transfer sovereignty toOermany but ln nana only; and that while there will be many incidents, the East Germans won'thow-down at thla time. The West, will is foroed to deal with the Gorman Reds to ksep their supplies flowing to Berlin but, to savs facs, our officials will take the position that they are treating the Gormana as the agents of Moscow.

In the Middle East, Americans continue to bedisliked by the Arabs. In their opinion, our country ls dominated by lntersats strongly favoring Israel. Khrushchev ls cleverly forcing ths Arabs to rely more heavily

upon Russian aid by encouraging Jews behind the Ironto migrate to Israel. Bon-Qurlon" has publicly estimated

ews from behind the Iron Curtain will arrive ln Israel this year; and ths Isrssll bond drives In tthe Onlted States for funds with whioh to ostabllsh theas Iramlgranta are particularly galling to the Arabs.

Onongress will be held in Cairo of sll of the Arab oil producing states* Dr. Peres Alfonzo, the new Venezuelan Minister of Mines and Hydrocarbons, has besn Invitsd to attend as an observer and Venezuela will be the only non Arab country officlslly represented.

Shortly after World War II ended. Dr. Alfonzo forcedrofit-sharing principle on the oil componiee in

Venezuela and then he left immediately for tho Kiddle East to encourage the Arab oil countries to similarly increase their share of the oil profits, vhioh they did shortly Slnoe Venezuela has recently Inoreased Its percentage

UO basis, Alfonso undoubtedly will, again, try to influenoe the Arabs to force an lnorease in their percentage. However, aa Iran, Kuwait and Saudi Arabia, ln conoessiona recently granted to the panicky Standard Oil Company of Indiana, and to Italian and Japanese interests, have initiatedplit plus large bonuses. Dr. Alfonzo will undoubtedly return hone indoctrinated to increase Venezuela's oil oontraets fronore.

Onnd ln advance of the meeting to be held In Cairo, the British Petroleum Company was very bold ln outtlng the posted prloe of Middle Eastern crudearrel. Kuwait orude, tho largest volume of Kiddle Eastern oil, accountsOOfOOO barrels of tho aroa'abarrels dally production. British Petroleum's cut reduced tho prioe ofravity oil at Klna-al-Ahmadl7 per barrel.

The first time bomb that is most likely to explode ln the Kiddie East is Iraq. This country's economichas progressively deteriorated since its revolution of last year. Communists dominate the nation and control-its press and propaganda servioes. Almost all Communist countries, including little Albania, have missions thore.

0 Americans residing In Iraq are harassed and treatsd as enemies and spies by General Xassem's government.

I was most surprised to learn from Ambassador Hare thatthe arch trouble maker-In Iraq'a oil Industry. China desporstely needs oil and ls after Iraq'a rloh oil reserves. If Oeneral Kassea continues In power and China takes over the development of Iraq's oil rasouroas, It vill lead to an eoonomlo war ln which both tho West and all th* other Arab oil producing oountriea may be flattened. China would ropldly develop Iraq'a fabulous, proven, and almost unllnitsd oil reserves, then broak the world oil price structure by selling Iraq's oilarter basis or at cut rates.

The oil of Iraq is Just what China needs toits starved economy and, at the same tine, toCommunism by undermining th* oil markets of the

For some time Russia, with her limited oil resources, has bsen engaged ln just this kind of economicher oilarter basis or making prlos concessions. It ls shocking to note thatew days ago, Russia soldut prlc* snd unloaded ln New Yorkarrels of oil from Roumania.

Thereo question, but that ths CommunistsIntensify their eoonomlo war by penetrating themarkets. This aotlon will bo followed byto break down tho price structures of other

NATO ls being outflanked by developments ln the Middle East.

Soviet experts, supposedly for work on tho first stage of the high dam project at Aswan, hava arrived in Cairo. Howsver, It is unlikely that this dam will evor be built. The cost of Its construction would be tremendous end the Egyptian eoononiy Is so desperate that they can not afford It.

Ths present don at Aswan was built8 to control the Nile for irrigation. 2 the height of the dam was Increased to lLjoi fsst and It affects the water level of the Nilsiles

The location of the proposed new dam Islts six miles above the prssent dsn where thereass which If It oould be successfully blocked, would dam5 milliard oubio feet of water-ake tbat wouldiles long, tha alts of Lake Michigan. The difficulties encountered In building thla nsw dam would be very great. It would entail tbe necessity ofigantic loan from Russia or America, reaching an agreement with The Sudan

whose territory would be pertly flooded by the lake,are najor technical-dlffloultles* At the passdaat la propoeed to be built* the bad ol* tha rlTerloose and it via not possible tooncrete damusual type. Instead, It-is proposed to blook up the sand and earth in an embankment about a

If thla dam, with the great pressure behind It,only all human beinga and houaes butgood part of the soil of the Nils Valley would bo swoptInto ths Mediterranean by the huge mass of water*

In Egypt, allentered on the banks of the Nile, therefore,-the high dam, while providing meansreater population for Egypt, would at the sans time present the biggest booby.trap in all history. Braaching of the dam by adestroy tha sntire country*



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