You can read part one here.
In 1948, shortly after the end of World War II, Israel gained its independence, sending Arab nationalism through the roof. Pan-Arab nationalist regimes began to mushroom all across the Middle East.
In the early 1950s, Egypt took the lead. King Farouk, the decadent and corrupt Egyptian monarch, was promptly subject to a military coup and forced to abdicate. In 1954, Colonel Gamal Abdel Nasser assumed the leadership of the nation, first as a self-made prime minister, then as a presidential candidate – on a ballot of one. His anti-colonialism, anti-Israel vision and policies made him quite popular with the Egyptian population and military. Shortly after his ascension to power, he began a program of wholesale modernization. His first project was the Aswan High Dam.
The construction of a dam on the Nile at Aswan was strategized to bring considerable benefits to the Egyptian economy – but came with a hefty price tag. With his coffers empty, Nasser looked to the West and in January 1956, he found willing funders in Britain and the U.S.
We must remember, however, that this was an era of increasing polarization. The chilled winds of the Cold War were acutely felt even in the scorching deserts of North Africa. Nasser, an adroit politician overall, didn’t want to limit his options by committing his country to a particular side. While negotiating with the West for the funding of his modernization program, Nasser was also buying weapons from the East; namely, Soviet-made tanks, airplanes, and arms from Czechoslovakia.
Colonel Nasser became the figure of Pan-Arab nationalism in the early Cold War (Wikipedia.org).
As you would imagine, this didn’t sit well with his funders-to-be. Grasping at the opportunity (their confidence in the feasibility of the project by now shaken), both Britain and the U.S. withdrew their offer of funds.
It was at that very moment that Nasser decided to seize the Suez Canal—allegedly to fund the construction of the dam—and expel the last remnants of Western imperialism from his country.
But how to go after it?
To begin with, the Egyptian military, despite frantic modernization, didn’t stand a chance against combat-experienced French and British forces. The French had just come out from Indochina, after the debacle at Dien Bien Phu in 1954, and the British were still fighting in Malaya against a Communist insurgency.
Also, the French and British enjoyed a technological and weapon superiority. With helicopters, jet fighters, and aircraft carriers, they could not only outgun the Egyptians but, more crucially, out-maneuver them at will.
Nasser and the Egyptian military thus staked everything on two points: first, at the international outcry that would be caused if such a blatant violation of sovereignty occurred—they were looking particularly at the two superpowers; and second, at the domestic outcry that would be caused in France and Britain if they were tied up in a costly war—the French population was already war-weary after seven years of conflict in Indochina.
The die had been cast.