United States and Israel Sign Friendship Treaty; Pact Will Further Economic Relations
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United States and Israel Sign Friendship Treaty; Pact Will Further Economic Relations

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The governments of the United States and Israel today signed a treaty of friendship here which extends “most favored nation treatment” to each of the two countries. The treaty was signed at the State Department by Secretary of State Dean Acheson on behalf of the United States and by Ambassador Abba S. Eban on behalf of Israel.

This is the first treaty of its kind to be entered by Israel. It is subject to ratification by both governments before it will become effective. It is terminable at any time after ten years by six month’s prior notice. Registered as a Treaty of Friendship, Commerce and Navigation, the pact establishes a set of principles to govern basic economic relations between the United States and Israel, and to serve as practical means of directing the future development of these relations along, mutually beneficial lines.

The treaty ensures the liberty of travel and the protection of the properly, economic activities, residence, religious observance, professional and philanthropic activities and access to courts of the nationals and companies of either of the two countries in the territories of the other, subject to limitations in connection with communications, banking and exploitation of land and other natural resources.

Each of the two countries agrees, under the treaty, to accord within its territories to citizens and corporations of the other treatment no less favorable than it accords to its own citizens and corporations with respect to most business activities. Social benefits accorded to nationals of either country are also extended to nationals of the other country.


Within the territories of either country, nationals and companies of the other land are not to be subject to a greater burden of taxes than local nationals and companies. Subjects of either are to be accorded the same treatment given to nationals themselves in connection with patents, trade names, and the like. Property is not to be taken except for public purposes, and then only with effective and just compensation.

The treaty provides that there should be no restrictions in connection with foreign exchange transactions except in times of stringency and then only to the extent necessary to balance the country’s payments and to pay for the goods and services that are essential to the health and welfare of the people.

The treaty stipulates freedom of navigation and transit. It says that there is to be consultations between the United States and Israel, upon the request of either of the two governments, in connection with business practices which might have harmful effects on their mutual commerce. Where enterprises are controlled by the governments of either state, their imports and exports, purchases and sales are to be effected in accordance with commercial considerations, and nationals and companies of each of the two states are to be afforded adequate opportunity to compete for such transactions.


The treaty makes a significant contribution to the pattern of economic agreements already concluded between the United States and Israel. These agreements deal primarily with specialized technical subjects, such as the air transport and copyright agreements concluded in 1950 and the general agreement on technical co-operation, which was entered into in February of this year.

Commenting on the new treaty, which is the first friendship treaty to be concluded with the United States by a Near Eastern country, Ambassador Eban stated that it was further welcome evidence of the increasingly cordial relations between the two democracies. “Economic and commercial ties between Israel and the United States are continually becoming closer,” he said. He mentioned especially the industrial plants established in Israel by American capital.

The Israel Ambassador emphasized the importance of the clauses in the treaty which provide for conditions favorable to private investment and designed to promote economic development. These clauses, he said, were fully in accord with Israel’s policy of encouraging foreign investments.

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