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News :: Israel / Palestine |
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U.S. To Cut Aid To Israel Over Settlement Activity |
Current rating: 0 |
by AP via gehrig
(No verified email address) |
16 Sep 2003
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Good news -- a direct US action meant to stop the settlements. |
September 16, 2003
U.S. to Cut Aid to Israel Over Settlement Activity By THE ASSOCIATED
PRESS
Filed at 3:14 p.m. ET
WASHINGTON (AP) -- The United States will reduce loan guarantees to
Israel for expanding construction of homes for Jews on the West Bank,
the State Department announced Tuesday.
Under law, the guarantees may only support activities in areas Israel
held before the 1967 Mideast war, deputy spokesman Adam Ereli said.
The construction is ``inconsistent'' with the objectives and
understandings reached between the United States and Israel, he said.
The amount of loan guarantees to be withheld is being negotiated with
Israel and will be based on what Israel is spending on settlement
activity, Ereli said.
Secretary of State Colin Powell will make that decision, White House
press secretary Scott McClellan said Tuesday.
Still under consideration is Israel's construction of a security barrier
between it and Palestinian-held areas. The administration has not
opposed the fence entirely, but objects to any interference with
Palestinians.
McClellan, hinting that the administration may punish Israel for the
barrier, as well, said ``We have made our own concerns known. I don't
rule anything out at this point.''
Ereli said the United States would issue guarantees for $1.6 billion in
Israeli bonds. Overall, Israel was promised $9 billion over three years.
The threatened reduction is likely to come out of future installments.
At least twice before in the past decade the United States has penalized
Israel for expanding settlements contrary to U.S. law. The U.S. aim is
to stop Israel from taking over territory that might become part of a
Palestinian state.
The law authorizes the Bush administration to reduce dollar for dollar
what is spent on settlement expansion, which is also prohibited under
the U.S.-backed and now-stalled ``road map'' for peacemaking between
Israel and the Palestinians.
No direct assistance to Israel, which already receives nearly $3 billion
in military and economic aid, is involved. What the Bush administration
agreed to do was to stand behind Israel by guaranteeing $9 billion in
loans it would seek commercially.
The U.S. guarantee is designed to help Israel obtain favorable rates.
The Israeli economy, already hurt by terror attacks that strained the
treasury and discouraged tourism, suffered further setbacks when the
United States went to war against Iraq.
Foreign Minister Marwan Muasher of Jordan met, meanwhile, with Powell
and called for international monitoring to make sure Israel stops
building settlements, halts construction of the security barrier and
ends what the Arab minister called Israel's occupation.
Muasher said his government wants the U.N. Security Council to adopt a
resolution criticizing Israel for threatening to remove Palestinian
leader Yasser Arafat.
King Abdallah II is due to meet with President Bush at Camp David, Md.,
later in the week.
Treasury Secretary John Snow, on a visit to the region, met Monday night
with Palestinian Finance Minister Salam Fayad and the Palestinian
economy and planning ministers. On Tuesday, he held talks with Israeli
Prime Minister Ariel Sharon and was to meet with Finance Minister
Benjamin Netanyahu.
Snow assured both sides that President Bush remains committed to a
Mideast peace plan despite an upsurge in violence.
``The United States wants to be supportive and helpful to see that we do
move down that road to peace,'' Snow said before meeting with Sharon.
The U.S.-backed ``road map'' peace plan is in jeopardy after an increase
in violence, including a rash of Hamas suicide bombings and targeted
killings of Hamas members by Israel in the past month.
Sharon, meanwhile, was to tell Snow that Israel needs the $9 billion in
U.S. loan guarantees to promote growth, said an Israeli government
official who spoke on condition of anonymity.
Early Tuesday, the Israeli Cabinet approved a $48.24 billion budget for
2004 that cuts spending by $2.2 billion.
The United States had threatened to reduce the loan guarantee package by
the amount Israel spends on a security barrier cutting through the West
Bank. Israel and the United States disagree over the course of the
barrier, with Washington trying to minimize the amount of West Bank land
included on the ``Israeli'' side.
In the 1990s, the United States deducted money Israel spent on Jewish
settlement construction from loan guarantees.
An Israeli official said deductions would again be made for settlement
spending. ``When we went this year and asked for the $9 billion in loan
guarantees, they (American officials) said the same conditions (as in
the 1990s) will apply,'' the official said.
The official said there would be no deduction from the upcoming first
installment of $1.6 billion in guarantees, only from future installments
and the cuts were not related to the 400-mile West Bank barrier, of
which 90 miles have been completed.
``There is nothing about the fence,'' the official said.
Snow's visit to Jerusalem is the first stage of a 10-day tour to Saudi
Arabia, Afghanistan, Pakistan and the United Arab Emirates. He leaves
for Riyadh on Wednesday.
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