Northwest of Suez: The 1956 Crisis and the IMF

29 Pages Posted: 6 Feb 2006

See all articles by James M. Boughton

James M. Boughton

International Monetary Fund (IMF) - Policy Development and Review Department; National Bureau of Economic Research (NBER)

Date Written: December 2000

Abstract

Egypt's nationalization of the Suez Canal in 1956 and the failed attempt by France, Israel, and Britain to retake it by force constituted a serious political crisis with significant economic consequences. For the United Kingdom, it engendered a financial crisis as well. That all four of the combatants sought and obtained financial assistance from the IMF was highly unusual for the time and had a profound effect on the development of the Fund. This case study illustrates the complexities in isolating the current account as the basis for determining a balance of payments need and shows that the speculative attack on sterling - and the Fund's response to it - were remarkably similar to financial crises in the 1990s.

Keywords: Suez, IMF, Financial Crises

JEL Classification: F33, F34, N20

Suggested Citation

Boughton, James, Northwest of Suez: The 1956 Crisis and the IMF (December 2000). IMF Working Paper, Vol. , pp. 1-29, 2000. Available at SSRN: https://ssrn.com/abstract=880301

James Boughton (Contact Author)

International Monetary Fund (IMF) - Policy Development and Review Department ( email )

700 19th St. NW
Washington, DC 20431
United States
202-623-7477 (Phone)
202-589-7477 (Fax)

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

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