Israel Seeks No Trade Pact with Britain; Wants Release of More “frozen” Assets

No formal trade agreement between Britain and Israel Is now envisaged, David Horowitz, Under-Secretary of the Israeli Treasury said today following conclusion of negotiations with the British Government which resulted in the unfreezing of blocked Israeli sterling assets to the equivalent of $27,800,000 over the next six months. The freed funds will be used to finance Israeli purchases in Britain and the sterling area.

Negotiations for the release of additional sums from Israel’s blocked assets in London will be carried on after the expiration of the current agreement in October, Mr. Horowitz stated. The forthcoming negotiations in Tel Aviv, he added, will not be connected with this problem, but with British and Israeli claims and counter-claims.

Trade agreements so far concluded by Israel, with Holland, Poland and Hungary, Mr. Horowitz said, were designed mainly to facilitate the transfer of property of emigrants from those countries to Israel. The general pattern of Israeli trade, he said, has not yet been laid down.

Discussing the future of Anglo-Israeli trade, the Israeli official stated that capital investments in Israel would have to be much higher than the $100,000,000 loan ranted for capital investment by the Export-Import Bank with the proviso that purchases must be made in the United States. There would, he said, consequently be room for extensive purchasing in Britain.

Forecasting a large industrial development in Israel, Mr. Horowitz said the expansion of electrification in the country would keep pace with this development and the necessary electrical equipment would be obtained mainly in Britain. In addition, Israel contemplates purchase of pipe, trucks, and agricultural machinery there.

EGYPTIAN INTERFERENCE WITH BRITISH SHIPS AFFECTS ISRAEL

Commenting on reports that British Foreign Secretary Ernest Bevin was to raise with the Egyptian Foreign Minister, Aimed Pasha, the question of Egyptian interference with British ships in the Suez Canal; Mr. Horowitz said that this interference had considerably affected Israel. He said it was contrary to the Egyptian undertakings under the Rhodes armistice, as interpreted both by the United Nations and by Israel.

The London News Chronicle said today that the Egyptian authorities had interfered with the passage of nearly a hundred ships flying the British flag since the expiration of the British Mandate over Palestine a year ago. The paper commented editorially that this behavior suggested that Egypt, having ceased its shooting war against Israel, intended to pursue economic warfare instead. “If this is to be the policy of one of the principal Arab states, the paper said, “it is hard to see how there ever can be a settlement in the Levant.”