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Israel Will Build in East Jerusalem, but Not with U.S. Funds, Says Levy

Israel made clear Thursday that while it wants to mend its frayed relations with the United States, it will not be deterred from building housing for immigrants in East Jerusalem or anywhere it pleases.

At the same time, Israel reaffirmed that it would not use loan money guaranteed by the United States to build housing beyond Israel’s pre-1967 borders.

The government’s position was stated succinctly in letters from Prime Minister Yitzhak Shamir to President Bush and from Foreign Minister David Levy to Secretary of State James Baker.

Shamir stated that although the United States has the right to designate how Israel uses American aid, it cannot dictate Israeli policy.

Levy’s letter to Baker, which was shown to the news media here Thursday, was a “clarification” of his earlier commitment to the Americans to refrain from settling immigrants beyond the “Green Line,” the imaginary boundary between Israel and the territories it conquered in 1967.

The sincerity of that commitment was called into question earlier this week when a Cabinet committee approved a plan by Housing Minister Ariel Sharon to build 17,000 new housing units for Soviet immigrants in Jerusalem, all but 2,000 of them in the Arab-populated eastern section of the capital, was not under Israeli control before 1967.

Levy’s letter recalled his talks with Baker last month at the State Department and the United Nations, as well as the Oct. 2 letter he sent outlining Israeli assurances on the use of some $400 million in loans that would be guaranteed by the United States.

NO PLEDGE TO REFRAIN FROM BUILDING

“You are well aware,” he wrote this week, that in the earlier letter “there is no undertaking, either direct or indirect, to refrain from construction within Jerusalem — or anywhere else, including Judea, Samaria and Gaza.”

Levy noted that this was fully and unequivocally expressed at their Sept. 5 State Department meeting, in which he explained to the secretary that his government was elected on the basis of certain ideological foundations that will not be changed.

The ideological stance of Levy’s Likud party and its coalition partners further to the right is unlimited Jewish settlement in the administered territories and no territorial compromise for peace.

Levy reminded Baker that in a letter of Sept. 21, the secretary affirmed he had listened carefully to Levy’s comments in Washington and acknowledged that Levy had “placed particular emphasis” on Israel’s refusal to abandon its principles.

Levy stated in his latest letter that he and Baker had “agreed that the funds deriving from the loans guaranteed by the United States will be used in keeping with that commitment given by the government of Israel year by year, which says that uses of the grant shall be restricted to the geographic areas which were subject to the government of Israel prior to the June 5, 1967 borders.”

Levy stressed, however, that this commitment never had any bearing on the status of Jerusalem, which was annexed and is Israel’s undivided capital.

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