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Politics : PRESIDENT GEORGE W. BUSH -- Ignore unavailable to you. Want to Upgrade?

To: steve harris who wrote (697169)	8/17/2005 8:02:27 PM
From: DuckTapeSunroof	Respond to of 769670

Israel says crisis defused with U.S. on arms exports By Dan WilliamsTue Aug 16, 6:49 PM ET news.yahoo.com Israel and the United States have signed an accord defusing a long-running dispute over Israeli arms exports to China that had soured relations with the Jewish state's chief ally, the Israeli Defense Ministry said. Washington, which provides Israel with $2 billion in annual defense aid and is expected to help finance its Gaza withdrawal, had complained that the sale of Harpy attack drones and other advanced technology to China could threaten Taiwan. The Israeli Defense Ministry said in a statement on Tuesday that it had signed an understanding with the Pentagon "aimed at solving past problems which had seriously harmed relations ... in the realm of technological security." Israel will take "further steps to fully restore trust" with the United States, the ministry added. It did not give details of exactly what had been agreed. Israel denied wrongdoing in the China case, and some Israeli security experts accused Washington of seeking to curb foreign competition to its arms companies. The U.S. complaint prompted Israel to apologize and reshuffle top defense officials. A Defense Ministry spokeswoman said the new accord with the Pentagon "covered the entire dispute" but she declined to say which of Israel's client countries would be affected. Israeli officials previously said Washington also had sought oversight over its lucrative defense exports to India. CHINA DEAL An Israeli newspaper said in June that, under pressure from the Pentagon, Israel had scrapped a deal to supply China with spare Harpy parts and would impose tighter controls on its arms exports. The Defense Ministry declined to confirm the report. Haaretz daily also said China would likely seek compensation from Israel over its reneging on the long-term Harpy deal and avoid future weapons purchases from the Jewish state. The dispute played a role in the U.S. decision in April to suspend Israel from involvement in the F-35 Joint Strike Fighter project. Washington torpedoed Israel's multi-billion dollar sale of Phalcon strategic airborne radar systems to China in 2000, citing concerns it could upset the regional balance of power. Israel has said it will seek $2.2 billion in special U.S. funding to help pay for its withdrawal from the occupied Gaza Strip, which began this week. Washington sees the pullout as a chance to revive a battered "road map" to a Palestinian state. Copyright © 2005 Reuters Limited. All rights reserved. Republication or redistribution of Reuters content is expressly prohibited without the prior written consent of Reuters. Reuters shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon. Copyright © 2005 Yahoo! Inc. All rights reserved.