Senior aides to Israeli Prime Minister Shimon Peres said the Israeli government has ruled out asking for any immediate additional economic aid from the United States but the finance minister said Israel would request the creation of a special fund for Israel to draw on if it needs an emergency infusion of cash.
Peres, who leaves here Saturday night on a week-long trip to the United States during which he will meet with President Reagan and other administration officials in Washington, will discuss how U.S. assistance could better spur Israeli economic growth, but will not ask for new loans and grants to help the country through its current fiscal crisis, according to the aides, Yossi Beilin and Nimrod Novick.
It had been widely assumed that Israel's rapidly deteriorating economy would prompt Peres to seek stopgap aid, with some reports putting the expected request at as much as $1 billion in addition to the $2.6 billion in economic and military assistance that Israel is due to receive from the United States in the current fiscal year.
Peres' aides did not completely rule out such a request being made early in 1985, but Beilin said, "That is not contemplated at the moment."
The details of the economic proposals Peres does intend to discuss in Washington remained vague and were further clouded tonight by Finance Minister Yitzhak Modai. He told a television interviewer that Peres will ask the United States to establish an "emergency fund" for use by Israel when the country needs the money.
The finance minister provided no details, but the fund he mentioned appeared to correspond to reports that some Israeli officials were urging Peres to ask for a line of credit of up to $2 billion from the United States to shore up Israel's international credit rating and to be used if the economic situation here deteriorates much further.
But, in separate remarks to reporters after a meeting in parliament today, Peres set the tone he clearly hopes to communicate in Washington in the meetings with administration officials.
"I don't have any intention of requesting a beggar's handout to save the situation here," he said. "Economic recovery in Israel I see as purely an Israeli mission. Certainly we will look among Jews, the U.S. administration and other places for opportunities to renew investments in Israel so that together with the programs of reduction that were imposed we will be able to start momentum toward renewing the economy and growth."
Israel would appear to have little to lose in ruling out an immediate request for emergency aid in connection with the Peres visit to Washington next week. Congress, which would have to appropriate any additional funds, is about to end its session and the new Congress is not scheduled to begin work until January.
Meanwhile, a new set of austerity measures designed primarily to stem an alarming drop in Israel's foreign currency reserves took effect here today and undoubtedly will be cited by Peres in Washington as evidence that the new government he heads is moving strongly to cure Israel's underlying economic ills.
The new measures include a total ban for the next six months on the import of 50 consumer items, including automobiles, cosmetics, color television sets, soft drinks, vacuum cleaners and wall tiles.
The import ban was approved last night by a closely divided government economics committee, which also voted to tighten restrictions on the amount of foreign currency Israelis can take abroad and to ban the use of Israeli-issued credit cards abroad after Dec. 31. The new steps were prompted by the announcement earlier this week that Israel's foreign currency reserves declined by $323 million last month, leaving the country, according to some estimates, with enough foreign currency to finance imports for only 40 days at their current levels.
The import ban sparked immediate criticism from business interests, who charged it would increase unemployment, fuel Israel's already staggering annual inflation rate of more than 400 percent and could end up costing the country hundreds of millions of dollars in lost tax revenues on imported products.
Peres, however, portrayed the ban as part of a five-point economic recovery program he said was being implemented to end several years of stagnant productivity, increasingly high inflation and a chronic balance of payments deficit in Israel.
Steps already taken, he said, include a $1 billion government budget cut, most of which government officials say has been agreed to, and cuts in government subsidies to reduce consumption and lower the standard of living. Still to be accomplished, according to Peres, are an agreement among government, business and labor to freeze or restrain wage and price rises and unspecified measures to "renew growth."