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-Caveat Lector-
_______ ____ ______
/ |/ / /___/ / /_ // M I D - E A S T R E A L I T I E S
/ /|_/ / /_/_ / /\\ Making Sense of the Middle East
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News, Information, & Analysis That Governments, Interest Groups,
and the Corporate Media Don't Want You To Know!
ISRAEL PUBLICLY BLACKMAILS THE USA
"Mr Sharon asked President Bush for the biggest aid package to Israel for
more than 10 years when they met at the White House last week...
Prof Kleiman says Mr Sharon is seeking to take advantage of Washington's
concern about Israel's role in any coming conflict with Iraq. 'I think
Sharon
is just trying to exploit it to get some money. Bush wants Israel to behave
more decently to the Palestinians and to keep out of a war with Iraq. Sharon
wants to exact a price and guarantees for cheap loans are it,' he said."
MID-EAST REALITIES - MER - www.MiddleEast.Org - Washington - 22 October 2002: The
last American Administration was quite literally riddled with dually-loyal
personalities, persons 'dually-loyal' to the US and Israel and in most cases
associated with the 'liberal' Labor-party wing of Israeli politics. The current
American Administration is quite literally riddled with dually-loyal personalities,
persons 'dually-loyal' to the US and Israel and in all cases associated with the
'conservative' Likud-party wing of Israeli politics. That is precisely the way the
very powerful and very multi-faceted Israeli-Jewish Lobby has sought to organize the
affairs of Washington; and it has succeeded far beyond even its own wildest
expectations. Even as multi-billions in war material and contracts are flowing into
Israel from the U.S., and even as the U.S. has essentially had its foreign policies
hijacked by the Israeli-Jewish Lobby as never before, the Israelis are pushing for
more and more knowing that in a very real sense they have the U.S. by the balls at
this point in history with a kind joint-control of the Middle East region for some
time to come now, they think, within their grasp.
ISRAEL ASKS U.S. FOR $10bn TO HALT RECESSION
INTIFADA TAKES ITS TOLL ON A ONCE-BUOYANT ECONOMY
By Chris McGreal in Jerusalem
The Guardian (UK) - Tuesday October 22, 2002:
Ariel Sharon is pressing Washington for billions of dollars of emergency aid
to revitalise the Israeli economy, driven deep into recession by the two
years of Palestinian uprising.
Already the biggest recipient of US foreign aid - $2.1bn a year, most of it
spent on military equipment from America - Israel is putting together a
proposal for up to $10bn (�6.5bn).
The intifada has helped to give Israel its worst recession for 25 years.
Foreign investment and tourism have collapsed. The shekel loses value by the
month. Unemployment has risen to 10% and shops suffer from people's
reluctance to wander through malls which may attract suicide bombers.
Three years ago the economy was growing at the rate of 6%: now it is
contracting.
The bursting of the dotcom bubble has compounded the crisis by battering the
hi-tech industries which were the engine of Israel's growth.
The government's attempt to contain the damage with deep budget cuts, tax
increases and a pay freeze has provoked a public sector strike which has left
the streets of Israel's main cities strewn with rubbish but done little to
reverse the economic downturn. And there is an election next year.
Last month the chairman of the national security council, Uzi Dayan, told the
knesset that the intifada was costing the economy close to �2bn a year and
that without an end to the violence there is little hope of reversing the
financial decline.
Professor Ephraim Kleiman, an economist at Hebrew University in Jerusalem,
agrees.
"Tourism revenues have halved. Foreign investment has fallen by two-thirds
since the start of the intifada, although much of that drop also has to do
with the bursting of the dotcom bubble.
"I think nothing will improve until something happens to the peace process."
Mr Sharon asked President Bush for the biggest aid package to Israel for more
than 10 years when they met at the White House last week.
The president made no promises, but he tried to talk up the Israeli economy
at a press conference. "We have great confidence in the Israeli economy. We
have a great confidence in the Israeli people. I am confident that the
economy will be strong," he said.
The head of the prime minister's office, Dov Weisglass, is heading a team
from the treasury and the foreign and defence ministries considering a number
of options, including a request for loans from the US treasury, guarantees
for low-interest loans from US banks, and the diversion of some of
Washington's military assistance to the Israeli treasury.
At present Israel must feed military aid back into the US economy by buying
American equipment. One proposal is for it to be spent on Israeli-made
weapons, which would help boost manufacturing and prop up the shekel.
Israeli officials said the Americans were "sympathetic" to the request, but
there is likely to be some wrangling about the kind of help and the political
price to be paid.
Prof Kleiman says Mr Sharon is seeking to take advantage of Washington's
concern about Israel's role in any coming conflict with Iraq.
"I think Sharon is just trying to exploit it to get some money. Bush wants
Israel to behave more decently to the Palestinians and to keep out of a war
with Iraq. Sharon wants to exact a price and guarantees for cheap loans are
it," he said.
Israeli officials acknowledge that the Americans may seek further concessions
in return for financial assistance.
In the early 90s Yitzhak Shamir, then prime minister, sought $10bn in loan
guarantees to help absorb hundreds of thousands of immigrants from the former
Soviet Union.
As a condition the Clinton administration demanded a freeze on Jewish
settlements in the occupied territories.
Mr Shamir refused, his government fell and he was replaced Yitzhak Rabin, who
agreed to the US demand.
Prof Kleiman thinks the Americans will not want to make loans themselves, so
guarantees are the most likely option. "Having these guarantees means there's
no chance of Israel reneging on its foreign debt," he said.
"This improves very much Israel's credit ratings, which have come to play a
much more important role. It's a confidence-building measure."
***************************
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ISRAEL WANTS $10b MORE FROM U.S.!
TEL AVIV, October 21 (IslamOnline & News Agencies) - An inter-ministerial team headed
by Israeli Prime Minister Ariel Sharon's bureau chief, Dov Weisglass, is working on a
proposal requesting American economic assistance that could top $ 10billion, an
Israeli newspaper reported Monday, October21 .
The team includes representatives from the treasury, the Foreign Ministry and the
Defense Ministry, reported Ha'aretz.
A government source said the reason for the aid request stems from the United States'
expected campaign against Iraq coupled with the American desire that Israel not
interfere with Washington's plans or use its troops against Iraq, the paper reported.
It added that sources at Sharon's Office said Sunday, October20 , that American
readiness to provide economic assistance has not been made in concrete terms.
"However, a number of ideas have cropped up in Jerusalem over the type of aid Israel
could use: cash, guarantees for low-interest bank loans from American banks, direct
state-to-state loans from the U.S. treasury, and the conversion of some American
defense aid into shekels.
"Currently, Washington provides Israel $2. 1billion a year that must be spent in the
United States on defense supplies. One proposal is for $ 2billion to be converted to
shekels and used to purchase defense equipment from Israeli manufacturers in the hope
that it would invigorate the Israeli economy," said Ha'aretz.
According to the paper, discussions about economic aid came up during the prime
minister's recent trip to Washington, and, in particular, during talks between
Weisglass and National Security Advisor Condoleezza Rice.
Weisglass said the aid was necessary to get the Israeli economy moving; U.S. President
George W. Bush mentioned American confidence in Israel's economy during a White House
press conference with Sharon after their meeting last week, it said.
Other than the annual economic aid, Israel expects fulfillment of a July2000 decision
made by then-president Bill Clinton to then-premier Ehud Barak for a $ 800million
grant. Since then, the sum has dropped to $200 million, and discussions were frozen,
for bureaucratic reasons, after Clinton left office, according to the Americans. But
with help of pro-Israel congressmen, discussions are expected to resume at the
beginning of the new year, reported Ha'aretz.
Meanwhile, BBC News Online reported that Israel is hoping to head off higher European
Union import duties on $200m worth of products from Jewish settlements in the West
Bank and Gaza Strip.
Israeli Foreign Minister Shimon Peres will meet his 15 E.U. counterparts at a meeting
Monday, with the aim of settling the proposal and avoiding international arbitration,
said BBC.
Goods from the areas nominally controlled by the Palestinian Authority are not covered
by a trade agreement signed in 2000 between the E.U. and Israel, which offers low or
zero tariff access. Only about2 % of the $7.6bn worth of exports from Israel to the
E.U. would be affected.
"The outcome of talks last Thursday were not made public, but Israeli officials said
they were optimistic about a resolution with their largest trading partner.
"The issue is highly political because it deals directly with the legality of Israel's
occupation and borders," said BBC.
However, BBC also said that the E.U. is expected to level a "catalogue" of criticisms
against Israel, ranging from human rights violations to reparation for destroyed E.U.
projects in the West Bank and Gaza Strip.
"Israel must proceed with easing of restrictions on Palestinian population and allow
full, safe, and unfettered access to the occupied territories for international and
humanitarian personnel," said Danish Foreign Minister Per Stig Moeller, according to
BBC.
"Israel must immediately stop the on-going expansion of settlements," he added.
Denmark currently holds the E.U. presidency.
Goods manufactured in the West Bank, Gaza Strip, occupied East Jerusalem and Golan
Heights cannot be labeled as "Made in Israel" under the trade agreements, BBC
reported. In November, the European Commission told importers they would have to
collect deposits for the full duties on imports from these areas.
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