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Likud Leaders Optimistic on Reaching Accord on New Government

Likud leaders expressed optimism today that an agreement will be reached shortly with their coalition partners on a new government to be headed by Yitzhak Shamir. Deputy Premier David Levy who heads the Likud negotiating team, said that all parties concerned have reached an understanding.

Levy said he expected that by the beginning of next week, President Chaim Herzog will have received Premier Menachem Begin’s formal resignation and will ask Shamir to formal resignation and will ask Shamir to form a government composed of the same parties that comprise the present coalition. The outlook brightened following meetings yesterday between the Likud negotiators and leaders of the Tami Party which had threatened to quit the coalition even before Begin announced his intention to resign two weeks ago.

Tami opposes recent stringent economic measures aimed at reducing Israel’s soaring inflation rate and its lopsided foreign trade deficit. The Likud leaders reportedly promised Tami that those measures will be rescinded, but if so the new government will face grave economic challenges from the outset.

Likud also has apparently satisfied the Aguda Israel Party that the concessions to Orthodox religion promised by Begin will be honored by the new coalition. These include a promise to emend the Law of Return so that only persons converted to Judaism by Orthodox rabbis will be recognized as Jews. The measure, defeated in the Knesset earlier this year, is bitterly opposed by some elements of Likud and by many overseas Jews.

The two other coalition partners. National Religious Party and the ultra-nationalist Tehiya have no particular demands and are expected to join the new coalition.

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