U.S. Hopes to Release Loan Guarantees to Israel by End of Week, Says Quayle

The United States hopes to release $400 million in long-delayed loan guarantees to Israel “later on this week,” Vice President Dan Quayle told an assembly of American Jewish leaders here Tuesday.

He characterized the problems holding up the release of the loan guarantees as “technical,” adding that “there is no substantive dispute” between the Bush administration and the Israeli government.

One Israeli diplomat attending the annual plenum here of the National Jewish Community Relations Advisory Council, where Quayle made his remarks, said, “We are glad it’s over.”

“It’s an important precedent for future loan guarantees,” said Mordechai Yedid, deputy consul general at the Israeli Consulate in New York.

The guarantees, which will be used to finance the construction of housing for Soviet Jewish immigrants, were approved by Congress last spring.

But they have been held up by the Bush administration because of concern that the money will either directly or indirectly be used to expand Jewish settlements in the administered territories.

Israel has grown increasingly impatient over the delay. When Israel’s ambassador to Washington, Zalman Shoval, expressed his frustration last week in an interview with the Reuters news agency, it led to a diplomatic fracas between the two countries. The White House publicly rebuked Shoval, calling his remarks “outrageous.”

Quayle’s remarks here Tuesday seemed to be an attempt to tone down the level of rhetoric and to reassure Israel and its Jewish supporters that the United States is eager to resolve the outstanding differences over the loan guarantees.

‘BAKER IS PLAYING HARDBALL’

There are still a number of questions Israel has not answered to the satisfaction of Secretary of State James Baker, according to Thomas Dine, executive director of AIPAC, the American Israel Public Affairs Committee.

These questions include the number of new settlements established in the administered territories during 1990, the amount of money spent by the Israeli government building new roads in the territories and the amount of money spent by each of the ministries in the territories.

“Baker is playing hardball, and the Israelis don’t like these questions,” Dine said in an address Monday to some 450 delegates to the NJCRAC plenum.

That same day, the NJCRAC delegates unanimously approved a statement urging the Bush administration to “implement expeditiously” its commitment to provide the loan guarantees.

Quayle’s pledge Tuesday that the matter would be resolved shortly appeared to take some Israeli and American officials in Washington by surprise.

The State Department could not immediately confirm the remark, but a department official said that if the vice president had indeed given the pledge, he must have known what he was talking about.

The Israeli Embassy said only that it had learned of Quayle’s remark and hoped it was true.

Israel has also complained lately that it has received no promise of compensation from the United States for some $3 billion in expenses it has incurred as a result of the war in the Persian Gulf. These include the costs of higher military readiness, damage to buildings caused by Iraqi missiles and loss of business as a result of the air raids.

In his now infamous Reuters interview, Shoval complained that Israel had “not received one cent in aid” from the United States to offset these losses.

REASSURANCES ON PEACE PROCESS

While the administration was clearly put off by this remark, Quayle nevertheless promised Tuesday that Israel would not be forgotten.

The White House soon plans to submit to Congress an emergency supplemental appropriations bill requesting additional funds for military operations in the Persian Gulf.

Quayle said the bill would not include any aid for Israel, since the requested funds will be “primarily and categorically for military operations.”

But he added that “Israel will be dealt with, even if not in this particular piece of legislation.”

The vice president also tried to reassure Israel that it would not be forced to make concessions on the Middle East peace process that are not in its interest.

“We will always make clear to the world that we are a steadfast partner with Israel in the search for peace,” he said.

Quayle restated the Bush administration’s opposition to an international conference as the best way to solve the Israeli-Palestinian conflict, saying that “real peace must emerge between the parties themselves. It cannot and will not be imposed from outside.”

“When this war is over, we will help find a real reconciliation between Israel, the Arab states and the Palestinians,” he said.