Telegram from Ambassador Walter Gifford to Secretary of State Dean Acheson, Number 581

INCOMING TELEGRAM Department of State COPY 1002 TELEGRAPH BRANCH 652 M X Action Control: 15309 NEA Rec'd: July 28, 1951 FROM: London 7:50 p.m. Info SS TO: Secretary of State DECLASSIFIED G EUR NO: 581, July 28, 9 p.m. Authorily Net- 86-28 (5tate Dept.tris 8-27-87) E By DED NAT Date 10-13-87 DCR NIACT SENT TEHRAN 33 (EYES ONLY FOR AMBASSADOR GRADY) FROM HARRIMAN RPTD DEPT 581. FOR PRESIDENT AND SECRETARY FROM HARRIMAN : Soue NO DISTRIBUTION EXCEPT AS DIRECTED BY SECRETARY'S OFFICE. I met with PRIMIN, FONSECY and number of members of Cabinet this afternoon accompanied by Gifford They expressed their desire to accept Iranian Govt's proposals but are faced with difficult problem of Brit public opinion here and morale of Brit personnel in south. I hope Iranian Govt will recognize their position in a frienôly spirit I am authorized to deliver the following as Brit reply if Iranian Govt will make favorable response: QUOTE HMG have received from Mr. Harriman the Persian Govt! S proposals for negotiation between HMG, on behalf of the Anglo-Iranian Oil. Company, and the Persian Govt, and for discussions of matters of mutual interest to the two govts. ATJT HMG are desirous of availing themselves of this invitation but it will be appreciated by the Persian Govt that the negotiations, which HMG for their part will enter into with the utmost goodwill, can be conducted in a satisfactory manner only if the present tension which exists in the south is relieved. On the assurance that the Persian Govt recognize this fact and will enter into discussions in the same spirit, a mission headed by a cabinet minister will immediately set out. HMG recognize on their own behalf, and on that of the company, the principle of the nationalization of the oil industry in Persia. END QUOTE. Brit have REPRODUCTION OF-TIIIS MESSAGE IS PROMBITED