Jerusalem, 7 September 1998

CABINET COMMUNIQUE

(Communicated by the Cabinet Secretariat)

At the weekly Cabinet meeting yesterday (Sunday), 6.9.98:

1. The Prime Minister told the Ministers that Dennis Ross is expected to visit Israel on Wednesday evening; on the agenda will be a discussion of the "redeployment" and a definition of 3% thereof all to be contingent upon the Palestinians fulfilling their commitments and the entire reciprocity package. All these issues still remain before us. In contacts which were held up until a few weeks ago, progress was made on the issue of the 3%, and Israel wishes to return to the discussion format in which this progress was effected.

2. The Prime Minister presented the economic objectives for the coming year continued economic stability, renewed growth and enhanced security.

The Prime Minister noted that Government policy over the past two years has helped to stabilize the Israeli economy in the face of international economic crises. The national debt inherited from the previous government two years ago was of such a scope that had it not been reduced over the two past years, Israel could have now found itself in an extremely difficult predicament; if the debt had been enlarged, Israel’s international credit rating could have been devastated. In the coming years, international credit will be granted to those who demonstrate fiscal responsibility, and the Government’s primary goal is thus to maintain economic stability in Israel and to act toward increasing growth and reducing unemployment.

The Government’s second objective is security. Greater security must be provided in the face of security threats from our more distant perimeter.

The Government’s third objective is to prepare for the possibility of genuine growth in the rate of immigration to Israel. In the past two years, the Government has closed ranks around common objectives in both the political-security and economic spheres, and this must continue to be the case.

3. The Cabinet empowered the Director-General of the Prime Minister’s Office to coordinate the work of the directors-general team examining the framework of benefits and incentives to be given to Confrontation Line communities in the wake of Operation Grapes of Wrath, and to submit to the Cabinet a recommendation for the continuation of these benefits. The team will submit its recommendations to the Cabinet within 45 days.

4. The Cabinet began its discussion of the proposed 1999 State Budget.