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The Finance Ministry appears to be backing down from its plan to dismantle the Ports Authority and privatize the country's harbors.

The ministry's decision to modify its original intention to privatize the ports has become clear to delegates involved in current talks between the Histadrut and state officials.

The Finance Ministry's plan to dismantle the Ports Authority was the cornerstone of the structural reforms in the economy that are incorporated in its 2004 budget plan; and the proposal regarding the ports was the main spark that ignited the still-unresolved dispute between the Histadrut and the Finance Ministry.

Under what appears to be the ministry's new formula, the ports of Haifa, Ashdod and Eilat would turn into independent government companies in a prolonged process that would be completed after several years. During the first stage of the plan, the harbors would operate as semi-autonomous units; but they would remain subordinate to the Ports Authority, which would not lose its power.

Amos Ron, Ports Authority director-general, said yesterday that significant progress has been reached in talks with the Histadrut, but he declined to give details.