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Shohat Reiterates Government Support for State of Israel Bonds Organization

Finance Minister Avraham Shohat has reiterated that Israel has no plans to dissolve the State of Israel Bonds Organization, contrary to reports that appeared in the press earlier this year.

Shohat did say, however, that the interest rates on the bonds were too high several months ago and that the rate has since been adjusted downward.

Speaking to Jewish journalists here Tuesday, Shohat sought to clarify controversial remarks attributed to him a few months ago. The minister said he never suggested the bonds were not useful or appreciated by Israel, as was reported.

“I look at the bonds organization as a very important organization,” he said.

Other Israeli officials, though, have questioned the government’s bond program — with its associated fund-raising expenses and the bond’s interest rates — at a time when the United States has approved billions of dollars in loan guarantees.

Likud Knesset Member Meir Shetreet has proposed to the Knesset’s Finance Committee that the bonds organization be dissolved.

Speaking on other matters, Shohat said the Labor-led government’s economic policy has already succeeded in boosting the rate of growth and exports and in spurring privatization.

A successful peace process would be a further boon for the economy, he said.

In explaining the strong performance of the economy, Shohat pointed to the shift in budget priorities made by the Labor government elected last June away from housing to infrastructure and education.

He also defended his decision not to create “an artificial” jobs program to help absorb new immigrants and bring down the unemployment rate, saying he had preferred to see the rate drop as a result of overall economic growth.

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