Foreign Relations of the United States, 1951, The Near East and Africa, Volume V

784A.5 MSP/12–751

The Acting Secretary of State to the Ambassador of Israel (Eban)¹

Washington, December 7, 1951.

Excellency: I have the honor to refer to current negotiations between representatives of the Government of Israel and representatives of the Government of the United States of America looking to the conclusion of an agreement for a program of economic assistance and technical cooperation and the relief and resettlement of refugees as authorized in the United States Mutual Security Act of 1951. Pending the conclusion of a comprehensive agreement concerning this program, which is now under study, and in order to provide emergency economic assistance to Israel as authorized in the Mutual Security Act of 1951, I am setting forth below certain principles and procedures on which our two governments have reached agreement.

1. In accordance with Section 511(b) of the Mutual Security Act, assurance is requested that the Israel Government has agreed to join with the United States Government in promoting international understanding and, good-will and in maintaining world peace and to undertake such action as they may mutually agree upon to alleviate the causes for international tension.

2. The United States understands that the Israel Government has taken careful note of the provisions of the United States Mutual Security Act of 1951 and the laws mentioned therein under which assistance may be provided, and that it intends to conclude an agreement with the United States Government as required by those provisions.

3. Pending the conclusion of this comprehensive agreement, however, my Government understands that the Israel Government has an immediate requirement of $25,730,000 to pay for certain materials delivered by suppliers and shipped to Israel since July 1, 1951, materials now ready for shipment and delivery, and new purchases urgently required, all of which are for refugee and relief projects in Israel. In recognition of this need the United States Government will make available beginning immediately up to $25,730,000, out of funds authorized under Section 205 of the Mutual Security Act of 1951, to pay for these materials and such services as may be mutually agreed upon. Payments out of this sum will be made under appropriate procedures to be mutually agreed upon.

4. It is understood that such immediate requirements may include up to $14,230,000 of current unpaid dollar obligations for refugee relief and resettlement projects or for reimbursement for payments for deliveries effected since July 1, 1951 of materials comprising parts of such relief and resettlement projects.

5. As a further means of carrying out the purposes for which the assistance made available by the United States Government is being provided, the Israel Government will deposit in a special account in the name of the Israel Government not less than the Israel pound equivalent, according to the official rate of exchange, of the dollar sums which may be paid under this agreement. Such deposits will be made from time to time upon notification to the Israel Government by the United States Government that payment has been made pursuant to this understanding. The sums required to be deposited in this special account shall be adjusted to conform with any change in the basis of computation of the amounts to be deposited that may hereafter be agreed upon. The sums in this Israel Government account shall be held or used for such purposes as may be agreed to between our two governments in furtherance of economic and technical assistance and the relief and resettlement of refugees.

6. The Israel Government and the United States Government will establish procedures whereby the Israel Government will so deposit, segregate, or assure title to all funds allocated to or derived from any program of assistance undertaken by the United States Government so that such funds shall not be subject to garnishment, attachment, seizure, or other legal process by any person, firm, agency, corporation, organization, or government when in the opinion of the United States Government such legal process would interfere with the attainment of the objectives of the program of assistance.

If the Israel Government agrees that the foregoing represents an accurate statement of the understanding of our two governments on this matter, I should appreciate receiving from you a written acknowledgment of this fact so that this note and your reply thereto may constitute an interim agreement between our two governments on this subject.

Accept [etc.]

James E. Webb

1. Drafted by Messrs. Waldo (NE), Dorsey (NE), and Cardozo (L/E); cleared by G and L/T and by Messrs. Emery and Merchant (S/MSA), Bingham (TCA), Stinebower (E), and Gardiner (NEA).