Shultz Dismisses Report That PLO is Prepared to Recognize Israel

Secretary of State-designate George Shultz indicated today that he did not put much stock in a report that the Palestine Liberation Organization was prepared to recognize Israel on a reciprocal basis.

“There are always statements floating around, ” by various PLO spokesman, Shultz told the Senate Foreign Relations Committee. Shultz spoke in response to a question about a statement made in Paris yesterday by Iscam Sartawi, an advisor to PLO leader Yasir Arafat, who also called on the United States to recognize the PLO and deal with it directly. (Related story from Paris, P.2.)

Shultz said the PLO leadership has to get up and say that they recognize Israel, recognize United Nations Security Council Resolutions 242 and 338, lay down their arms, and not to continue with terrorist activities. “Then we are dealing with a different organization,” he said.

Shultz, whose nomination is expected to be approved by the committee later today, repeated his statement yesterday that the Palestinians must be represented in negotiations dealing with their future. He said the PLO is only one of the claimants for that role. (Late Bulletin, P. 3.)

EFFORT TO STRENGTHEN U.S.-ARAB TIES

When Sen. Nancy Kassebaum (R. Kan.) suggested that the newly-threatened Iranian-Iraqi war might be used as another pressure point to urge the parties involved in the crisis in Lebanon to move with urgency toward an agreement, Shultz replied that there were enough reasons to settle the Lebanese crisis promptly without bringing in the Iran-Iraq war. But he noted that the Iran-Iraqi war demonstrated the value both to the Arab countries and to the United States of improved U.S. relations with Arab countries.

In his opening statement yesterday, Shultz stressed that he would make an effort to strengthen U.S. ties with Arab countries because “it is from them that the West gets much of its oil; it is with them that we share an interest and must cooperate in resisting Soviet imperialism; it is with them, as well as Israel, that we will be able to bring peace to the Middle East. “

In his testimony at yesterday’s afternoon session, Shultz said he had no specific differences on the Mideast with the Reagan Administration. “I will be able to make myself comfortable in this area with the President,” he said.

In reply to a question from Sen. Rudy Boschwitz. (R, Minn.), Shultz said he agreed with the President that Israel is a “strategic asset.” He said, as he had in his prepared statement earlier in the day, that the U.S. has to provide for a secure Israel. Shultz stressed however that “we weaken Israel” when, in strengthening its security, there is no parallel effort to bring about a settlement of the Middle East issues.

Israeli sources here saw the Shultz testimony yesterday, particularly his stress on the centrality of the Palestinian issue in the Middle East, as a complete change from the position of former Secretary of State Alexander Haig. They saw new pressure on Israel later this year aimed at a withdrawal from the occupied territories.

However, one American Jewish observer here saw Shultz as trying to present a down-the-middle approach, and said that the Jewish community will have to wait and see how his policy develops.

OTHER MATTERS DISCUSSED

In other matters, Shultz said today he did not know whether the Soviet Jewry issue was being brought up by the Reagan Administration in discussions on the resumption of a grain agreement with the Soviet Union. But he said Reagan has ordered that in all discussions with the Soviet Union, human rights problems be brought up, of which one is Soviet Jewry.

He also promised to take up the case of Raoul Wallenberg, the Swedish diplomat who helped save Hungarian Jews from the Nazis during World War II and who is believed to have been held in a Soviet prison since January 1945.