WASHINGTON (Dec. 18)
The United States Agency for International Development will assist in establishing a permanent economic research project in Israel under a credit agreement signed today.
The credit, amounting to $500,000 will be made available to the Hebrew University of Jerusalem to assist in providing a permanent endowment for the university’s Falk Project of economic research in Israel. It will match a new grant in the same amount, $500,000, by the Falk Foundation of Pittsburgh, Pa.
Signatories of the agreement signed here were William S. Gaud, Aid Administrator for the Near East and South Asia; Eliahu Elath, president of the Hebrew University, and Philip G. Whitman, president of the American Friends of the Hebrew University.
Directors of the Falk project of economic research hope to study in the next few years such aspects of the Israeli economy as the nature of the inflationary process, which the aid described as “a recurring feature in Israel.” Also to be studied are the operation of Government and Histadrut corporations, the workings of the Government’s development budget, and the economics of the collective settlements.
For the past two years, the Falk Project has been carrying out an extensive study, under a contract with the U.S. Department of Agriculture and provides policy recommendations on its future development. It is also now engaged in a study of the relative importance of the private government, and Histadrut sectors in the national economy.
A number of previous Falk project studies of various aspects of the Israeli economy have resulted in major policy recommendations to the Government of Israel. The only non-governmental economic research agency in Israel, it has been operating since 1954, when it was established under a five-year grant of $386,000.
Under terms of its establishment, the Falk Foundation must distribute its assets by 1964. As a result, its directors decided to make a grant of $500,000 towards the permanent endowment of the Falk project, the grant to be contingent on the granting of an equal amount by an Israeli institution. The Hebrew University, which will use the proceeds of the aid credit for the matching grant, has made an agreement with the Falk Foundation which assures the independence of the economic project while providing some degree of affiliation with the university.
The aid funds for the credit will be derived from proceeds of sales to Israel of U.S. agricultural commodities. The loan will be repayable in dollars in semi-annual installments over a period of 20 years with a three-year grace period.