Israel Seeking Economic Agreements with the U.S.

Finance Minister Yehoshua Rabinowitz left for Washington today in quest of economic agreements with the United States covering Israel’s latest requests for aid, the stimulation of American investments in Israel and the matter of double taxation.

Rabinowitz’s visit had been postponed several times in recent weeks owing to the strained relations that developed between Washington and Jerusalem after the suspension of the bilateral talks with Egypt conducted by Secretary of State Henry A Kissinger in March. But subsequent U.S.-Israeli contacts, including Foreign Minister Yigal Allon’s visit to Washington last month apparently have paved the way for Rabinowitz’s mission.

The Finance Minister told the Knesset Finance Committee yesterday that the U.S. government would soon publish a statement encouraging American businessmen to invest in Israel and would undertake practical measures to make such investments more appealing to Americans. A serious obstacle up to now has been the inability to recruit American businessmen to participate in a joint U.S.-Israeli commercial committee aimed at charting investment opportunities.

The committee was the idea of U.S. Secretary of the Treasury William Simon who proposed it when he visited Jerusalem last year. A similar committee has since been set up between the U.S. and Egypt with prominent American bankers and industrialists among its members. But so far, American business leaders have shied away from Israel, apparently for fear of Arab reprisals. Administration official in Washington say they can’t force businessmen to join the committee but Israeli officials feel that up to now the Administration has not tried to encourage them.

Avraham Agmon, director of the Finance Ministry, who is accompanying Rabinowitz to the U.S., told the Knesset Finance Committee he was optimistic over the prospects of American financial assistance to Israel and believed an agreement would be forthcoming during Rabinowitz’s visit to the U.S. He could not predict the scope of American assistance but said several arrangements of a practical nature already have been made between the two countries that indicated the U.S. was prepared to grant Israel material assistance on good terms. While in the U.S., Rabinowitz will confer with national and community Israel Bond leaders at a luncheon conference in New York May 14.