Quarterly Updates for (16 Nov 1994 — 15 Feb 1995)

Israeli-Arab Relations

With regard to the Gulf, Israeli officials reported at the end of January that initial, low-level contacts had been made with Saudi Arabia on possibilities for cooperation. Earlier, on 11/22, Israeli Dep. FM Yossi Beilin had met with Saudi (as well as other Arab) diplomats and businessmen at conference in Aspen, CO, regarding joint business ventures in light of peace process.

In a first visit by an Israeli leader to the Gulf (Israeli delegations had visited Qatar and Bahrain for multilateral meetings in 5/94 and 10/94 respectively), PM Rabin met with Sultan Qabus in Muscat 12/ 26-27 to discuss bilateral issues and possible agricultural assistance (irrigation and desalination) to Oman. In January, an Israeli Energy Ministry delegation traveled to Oman for talks on natural gas, and at a meeting in Aqaba in early February, FM Peres, Deputy FM Beilin, and the Omani FM agreed to open interests sections.

Israel's relations with Egypt during the quarter were said by both sides to have reached a low over the NPT and following the "Alexandria Summit" of Presidents Mubarak and al-Asad and King Fahd organized by Egypt on 12/29. Nonetheless, following Egyptian protests over the falling exports to Israel (from a high of $235 m. annually to $55 m. annually since 1992), Israel on 1/16 gave Egypt most favored nation status, removing it from list of countriesubject to licensing and high customs fees (100-200%).

Concerning the Maghreb, Israeli television reported on 1/7 that Morocco would be establishing an office in Tel Aviv in February. Jerusalem's Qol Yisra'el announced on 2/7 that Israel and Tunisia would be opening interests sections (through the Belgian embassies) in each other's countries in mid-February. Meanwhile, aTunisian tourism delegation denied reports that it had visited Israel in late January, stating that their visit had been confined to the Jericho area.

Regional meetings attended by Israel included:

  • A "mini-summit" ofthe foreign ministers of Algeria, Egypt, Israel, Morocco, and Tunisia held 12/5 at the Conference on Security and Cooperation in Europe, where the sides agreed to form a regional security organization that would meet bi-annually in Vienna at the foreign minister level.
  • A meeting in Aqaba on 12/12 of representatives from Egypt, Israel, Jordan, and the PA to discuss linking electricity grids. The same day, at the end of a two-day conference in Jerusalem on the environment organized by Israeli-Palestinian Center for Research and Information, representatives from the same countries announced the establishment of joint Eco-Peace Task Force to monitor effects of increased development on the environment. 
  • The first tripartite meeting on regional security between Egypt, Jordan, and Israel on 1/4 in Elat, Israel, to discuss prevention of cross-border infiltrations.
  • The 2/2 Cairo "summit" of Pres. Mubarak, PM Rabin, King Hussein, and Chmn. Arafat, which marked no progress and was seen largely as a "corrective" to the Saudi-Egyptian-Syrian summit in Alexandria that had raised fears of an emerging anti-Israeli front.
  • A 2/8 economic conference at the ministerial level in Taba, Egypt, including Egypt, Israel, Jordan, the PA, and U.S. Secretary of Commerce Ron Brown (see under "Regional Economic" below).

By the end of the quarter, there were signs of a slow-down in the trend towards Israel's integration into the region. Resistance from the Gulf countries to the establishment of a regional development bank including Israel gathered momentum (see under "Regional Economic" below). On 2/ 11, the foreign minister of Qatar, one of the first Gulf countries to hold open talks with Israel on economic and political cooperation (in London and the UN as of fall 1993), said his country would "not rush to establish ties with Israel" and denied that there were plans to open representational offices there. He also denied plans to export natural gas to Israel.

Inter-Arab Highlights

Jordanian-Palestinian relations improved over the quarter. Following tensions over Jordan's role with regard to "holy sites" in the Jordan-Israel treaty, meetings between the two sides paved the way for Arafat's meetings with King Hussein in Amman on 1/25. A general agreement and seven executive agreements on economic, cultural, and political cooperation were signed on 1/26 (see Docs A4-5).

Egypt played host to a number of meetings aimed at reconciliation and the resurrection of a united Arab front in advance of multilateral negotiations with Israel. Of note, Pres. Mubarak applied for observer status in the Arab Maghreb Union in November. On 1/24 he met with King Hussein in Aqaba for the first time in four years and agreed to renew relations frozen since the 1990 Gulf crisis.

Regional meetings included:

  • The seventh Islamic Conference Organization summit in Casablanca 12/13-14 attended by 11 Arab heads of state (26 Islamic heads of state) as well as prime ministers, foreign ministers, which passed resolutions on Jerusalem.
  • The Saudi-Egypt-Syrian summit in Alexandria 12/28-29 that endorsed Syria's position in talks with Israel and reiterated UN resolutions as the basis for peace in the Middle East, and encouraged a united Arab stand on negotiations (see Doc. A2).
  • The meeting of foreign ministers from Bahrain, Egypt, Kuwait, Oman, Qatar, Saudi Arabia, Syria, and the UAE in Cairo 2/5-6 that issued a statement condemning Israel's refusal to sign the NPT and supporting Syria's demands in peace talks.
  • The 1/22 meeting in Cairo of representatives of Egypt, Jordan, and the PA to coordinate positions in preparation for the four-party (Egypt, Israel, Jordan, Palestine) committee on repatriation of displaced Palestinians. Earlier, in December, the Jordanians and Palestinians agreed on the definition of "displaced Palestinians."

Regional Economic

During the quarter, plans to establish a regional Middle East Development Bank, proposed soon after the September 1993 Israeli-PLO Declaration of Principles and seen as key to efforts to integrate Israel into the region economically, were scaled down. Championed by the U.S. and Israel at the Casablanca economic summit in October 1994 and backed by a number of Arab countries including Egypt, Jordan, and the PA, the idea was resisted by the Gulf states led by Saudi Arabia (which feared the financial burden) and the EU. To overcome opposition, at a meeting of representatives from 39 countries and financial institutions at the State Department on 1/11, a proposal was tabled or a smaller bank than had originally been planned (initial capital expected to be as little as $1.5 b., less than one third what supporters had sought) and a special committee was set up to study the project as well as an alternative idea of founding a regional economic cooperation council on the order of the Organization for Economic Cooperation and Development. By early February, Gulf opposition, demonstrated in newspaper editorials and off-the-record statements by officials, had become forceful and overt. At a press conference during a visit to the UAE by U.S. Secretary of Commerce Ron Brown, the UAE minister of financial and industrial affairs declared that the "Arab world is not in need of an institution or a development bank in which Israel participates" and that "before talking or thinking of establishing a common Middle East market, some balance in security and economic interests between the Arabs and Israel must be established" (NYT, 2/17). 

U.S. Commerce Secretary Brown and executives from ten American corporations met in Taba on 2/8 with trade officials fr. Egypt, Israel, Jordan, and the PA to discuss investment possibilities and setting up a regional council for trade. The parties agreed to work toward establishing regional free trade and to form two economic bodies to develop their economic ties. Egypt, Israel, Jordan, and the PA also discussed the Arab economic boycott and agreed to support efforts to end it. (Nabil Shaath of the PA signed the closing statement mentioning efforts to end the boycott, though he criticized it for not also calling for an end to Israel's closure of Gaza and the West Bank.)