Germany is Rigid in Reparations Payments to Israel, Envoy Says

The new reparations schedule for the fiscal year beginning April 1, which was concluded in Bonn yesterday between Dr. F.E. Shinnar, head of the Israel Purchasing Mission in Germany, and Baron von Mahs, of the Bonn Economic Ministry, lives up to the letter of the Luxembourg Agreement, but does not meet all the expectations of the Israelis, Dr. Shinnar told the JTA today.

Dr. Shinnar, who gave the Germans full credit for scrupulously living up to the reparations pact, said that the latest schedule of deliveries had disappointed Israel in three respects:

1. Once again the Germans had taken advantage of the “escape” clause in the Luxembourg pact to set total deliveries of goods and services at the minimum allowed in the agreement–the equivalent of $59,500,000. The reparations pact had envisaged $73,800,000 as the normal annual payment and had foreseen the lower figure only if Germany was in economic difficulties, which it is not.

2. The Germans have refused to relax the present rigid system under which bilateral negotiations are held–such as those concluded yesterday–at which the categories and quantities of goods that Israel will receive are set for a full year in advance. This system, Dr. Shinnar noted, might have been appropriate under the economic conditions which prevailed in 1952, but in view of the fact that economic bottlenecks and scarcities have disappeared from the German economy a more flexible arrangement would be in line with the intent of the reparations pact and would be more efficient.

3. Israel still is not permitted to place long term orders in four of the five major categories under which German products are listed unless the goods thus ordered are delivered and paid for within a two-year period. Products for delivery after March, 1957, can only be ordered if they are classified as products of the steel manufacturing industry. Even for such long term orders as are authorized, no advance financing from future reparations payments is permitted by the Germans.

Dr. Shinnar expressed the hope that in future years more stress would be put on the spirit rather than the letter of the treaty. He paid tribute to the readiness of the Bonn Government to fulfill the text of the pact and to solve the complex problems of its implementation in an objective manner.

He revealed new details of yesterday’s agreement, including the fact that Germany had agreed to pay for $1,200,000 worth of natural rubber, cattle hides and asbestos which Israel will obtain from third countries, Dr. Shinner noted that in the three years since the pact has been in effect, Germany has made available to Israel some $155,000,000 worth of goods and services.