Israel Finance Minister Simcha Ehrlich told the Conference of Presidents of Major American Jewish Organizations today that Israel required American Jewry’s help to assure “massive support” from the United States in meeting the cast of evacuating Sinai under the terms of the proposed Egyptian-Israeli peace treaty.
The Israeli official disclosed that he had presented a detailed memorandum to Secretary of State Cyrus Vance, listing Israel’s financial needs and had held a “most cordial” meeting on the subject with Secretary of the Treasury Michael Blumenthal. Ehrlich said he was returning to Washington for further talks tomorrow.
While the U.S. agreed in the Camp David accords to help build two new air bases for Israel in the Negev–replacing bases that Israel will give up when it quits Sinai–Israel will have to construct a “permanent defense setup in the Negev” and procure “special military items” to offset the loss of early warning systems “and the vast air and ground space of Sinai,” Ehrlich said.
An additional burden, he said, would be the cost of transferring the civilian population from Sinai. He added: “These efforts, which are beyond the means of the Israeli economy, call for increased involvement of the American Jewish community in Israel’s economy” accompanied by “greater foreign private investments and enhanced efforts to encourage Israeli exports.”
OPTIMISTIC ABOUT ISRAEL’S ECONOMY
There are sound economic reasons and profitable opportunities for private business involvement in Israel, Ehrlich told the Conference. While asserting that “we are paying a heavy price in strategic terms for peace with Egypt,” Ehrlich voiced optimism that in the “new atmosphere” following the signing of a treaty, the Israeli economy would continue to grow and that there were hopes of trading with the Arab world through Egypt.
In response to a question about inflation in Israel, Ehrlich said that Israel could reduce the country’s inflation rate from 40 percent to 15 percent annually but only at the cost of imposing large-scale unemployment. “This we cannot and will not do, nor would the world Jewish community accept it,” he said. Instead, he continued, Israel will seek to reduce inflation by five to seven percent annually through intensive efforts to promote the sale of Israeli-produced goods abroad. Israel’s current economic goal calls for a doubling of its exports abroad, he said.
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