WASHINGTON (Jul. 10)
Unless amicable relations between Israel and the Arab states are achieved, the economic future of Israel is “not very encouraging, ” according to an analysis of the Israel agricultural economy released here by the Foreign Agricultural Service of the Department of Agriculture.
The report points out that Israel’s economic problems could best be alleviated if the Arab position toward Israel were resolved. If this were accomplished, the report asserts, Israel could cope with future economic problems. “Military expenditures could be cut drastically, commercial relations could be established with the traditional neighboring Arab markets, a reasonably adequate water supply could be obtained, “the report says.
In summary, the report states that while Israel has made “impressive progress” in agricultural and industrial production, the population has doubled since 1948 and the food production per person has only risen 20 percent. It establishes that Israel has a “very unbalanced economy and an inflation which has not been controlled.”
The analysis by the Department of Agriculture expresses the view that United States grants-in-aid and German reparations payments cannot continue indefinitely at the present level; also that Israel’s second generation will not hold the devotion and enthusiasm of the original idealistic settlers who were dedicated to the establishment of an independent Jewish State.