\There can you find a
pediatrician at 8 p.m. on
a holiday weekend?

Settlements
Affect Loans

Washington (JTA) — In a
move that could embarrass
the Israeli government at a
sensitive time in relations
with the Palestinians, the
United States has decided to
deduct $437 million from
Israel's next installment of
U.S. loan guarantees be-
cause of Israeli settlement
activity in the administered
territories.
The U.S. loan guarantees
to Israel, which total $10
billion over a five-year
period, have been controver-
sial from the start.
After a lengthy battle pit-
ting the Bush administra-
tion against much of the
American Jewish commun-
ity, the United States last
year started providing Israel
with $2 billion annually in
loan guarantees over a five-
year period.
However, under terms of
the arrangement worked out
between the United States
and Israel, the United States
will deduct from each in-
stallment — beginning with
this second one — the
amount the two countries
agree was spent on set-
tlements in the territories
during the previous year.
While Israel has agreed to
that arrangement, it now
appears to be concerned
about the message a $437
million deduction will send
just as it has concluded
major agreements with both
the Palestinians and Jordan.
Perhaps in response to this
concern, the State Depart-
ment did not officially an-
nounce the deduction and,
when asked about it, stress-
ed that it was not a new
policy but an implementa-
tion of an existing agree-
ment between the two coun-
tries.
The department said the
U.S. government would pro-
vide Israel with up to $1.563
billion in loan guarantees
for the 1994 fiscal year,
which began Oct. 1.
Israeli officials here said
that more than half of the
settlement spending con-
sisted of commitments to
settlements made by the
previous Likud government
that the current government
was honoring.
The Israelis said the cur-
rent Labor government is
planning in the future to
decrease the amount it
spends on settlements, espe-
cially in the wake of the
historic agreement it signed
at the White House last
month with the Palestine
Liberation Organization. El

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