Under the Anglo-Egyptian treaty of 1936, which made Egypt virtually independent, Britain reserved rights for the protection of the canal, but after World War II, Egypt pressed for evacuation of British troops from the area. Egypt in 1951 repudiated the 1936 treaty, and anti-British rioting and clashes on the border of the zone erupted. In 1954, Britain agreed to withdraw, and in June, 1956, the British completed their evacuation of armed forces from Egypt and the canal zone.
After Great Britain and the United States withdrew their pledges of financial support to help Egypt build the Aswan High Dam, Egyptian President Gamal Abdal nationalised (July, 1956) the Suez Canal and set up the Egyptian Canal Authority to replace the existing privately owned company. In August, British oil and embassy officials were expelled from the country. Having been denied passage through the canal since 1950 and having suffered repeated border raids from Egypt, Israel, with French and English air support, invaded Egyptian territory on Oct. 29, 1956. Within a few days France and Great Britain sent armed forces to retake the Suez Canal. Intervention by the United Nations brought an armistice in early November, and a UN emergency force replaced the British and French troops. The canal, blocked for more than six months because of damage and sunken ships, was cleared with UN help and reopened in April, 1957. Egypt agreed to pay, in six annual instalments, approximately $81 million to shareholders of the nationalised Suez Canal Company; final payment was made on Jan. 1, 1963.
The decision to use force against Nasser was clearly related to the assessment made of him but it was possible to take a very unfavourable view of Nasser, and yet to insist that any action taken must have the approval of the UN. This was the position adopted by Gaitskell. Many of the leaders in the British and French Governments saw Nasser as another Hitler and Gaitskell agreed although he said “While force can not be excluded, we must be sure that the circumstances justify it and that it is, if used, consistent with our belief in, and our pledges to the Charter of the United Nations and not in conflict with them”. A vote for a Cease Fire was initiated, Britain vetoed it and Gaitskell condemned the act as “an act of disastrous folly whose tragic consequences we shall regret for years”. Britain had a plan though. Eden and Lloyd believed that the conflict would spread, a war between just Egypt and Israel, whilst troublesome, shouldn’t of proved to be internationally dangerous. Where as if the war spread to Jordan and Syria, Iraq could join in, would cause a very large problem for Britain and France. Britain believed that the only way to get what they wanted and take control of the Damn and suppress Nasser was by force. Britain, France and Israel created a plan in which if their was any conflict between Israel and Egypt, Britain and France would intervene. Therefor British troops would remain in Egypt. It is now clear that it was France and Israel who were the originators of the plan for a concerted attack on Egypt. It was necessary for Britain to be bought in as only Britain had the bombers that were needed to put the Egyptian air force out of action. On the 18th of October a full cabinet agreed that should Israel attack Egypt, Britain and France would be justified in intervening to protect the Canal. Israel and Egypt entered conflict, started by an attack from Israel. Israel withdrew, Egypt followed, British and French forces then intervened. British and French air forces then launched a series of attacks at Egyptian airfields. Paratroopers were dropped at Port Said and a day later a naval bombardment and the landing of sea-borne troops followed. With in 24hours 20miles of canal were occupied and the causalities were very light. The entire canal could have been taken over with in a week.
Although militarily it was a great success, the diplomatic consequences were disastrous. Britain had alienated most of the commonwealth and the United States, which had been left entirely in the dark. Almost before it had begun, the British Government decided to end the Suez operation. The United States had refused to back Britain in supporting it in Egypt. The U.S had told Britain to get out, as they had no intention of helping them. The Canal had been put out of action to spite the West by Egyptian forces sinking ships to block a passage for Western shipping industries. This was the major indication that Britain was no longer a World Power and was nothing more than a minor in comparison to the United States.
The Suez Crisis was very humiliating for Britain at the time. Britain had left Egypt like a dog with its tail between its legs on America’s command. This is a major point in Britain’s self image, status and prestige. The entire Suez Crisis would have changed the world’s view on the new Britain. It was no longer a mighty imperial power, it was but a minor influential power in the Anti-Soviet alliance and its status and prestige as a “Great Power”. Britain’s national pride and international standing was greatly dented – Britain were no longer seen as a Great Power at all. Members of Britain’s commonwealth were unsettled and whether or not the Commonwealth would break up was uncertain. Many saw Britain as nothing but a follower of America. Good relations were restored with America almost immediately. The Suez Canal was re-opened under Egyptian control, helped out by the UN.