Following three days of intensive discussions in Washington, D.C. progress has been made in talks between Israel and the U.S. on the military agreement aid, but the two sides have yet to reach a deal. Senior American and Israeli officials expressed their optimism, telling Haaretz that most of the remaining gaps are technical, and that they believe that an agreement could soon be reached.
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Talks between the Israeli delegation and the senior American team took off on Monday at the White House. Jacob Nagel, acting head of the national security council, led the Israeli team, which also consists of Maj. Gen. Amikam Norkin, the commander of the IDF’s Planning Directorate, senior treasury officials and Ambassador to the U.S. Ron Dermer.
The American team is headed by National Security Adviser Susan Rice, and includes Yael Lampert, an Israel adviser at the White House, U.S. Ambassador to Israel Dan Shapiro and senior officials from the Defense, State and Treasury departments.
The talks ended overnight on Thursday, with both sides conveying optimism: "We've made progress and closed many of the remaining gaps. We hope soon to be able to reach final agreement," said one American official. A senior Israeli official made a similar statement. "Progress has been made and gaps were closed," he said. "Israel and the U.S. hope to reach an agreement soon."
The negotiations over the military aid deal began in November 2015. U.S. President Barack Obama offered Prime Minister Benjamin Netanyahu to begin talks half a year earlier, but Netanyahu refused to do so and prevented talks from beginning for many months as part of his attempt to thwart the nuclear deal with Iran. Netanyahu agreed to begin the talks on the military aid deal and the upgrading of the IDF's capabilities only after his attempts to stop the agreement with Iran failed.
Talks between the sides on military aid were slow over the past four months following many disagreements and Israel's refusal to meet the conditions set by the U.S., primarily bringing to an end the agreement allowing Israel to use some 40 percent of American aid money to purchase equipment from the Israeli military industries and to purchase fuel for the IDF. This amounted in recent years to some 1.2 billion dollars a year. The U.S. demanded that all the aid be used to purchase only from the American military industries.
For a long time, Netanyahu contemplated not complying with the American demands and not to sign the aid agreement with Obama, but to wait for January 2017, when a new president enters the White House. However, Netanyahu then understood that he won't receive a better deal from the next president and decided to concede to American demands. The compromise reached by the sides was that putting a stop to using aid money for purchases from the Israeli military industries would happen gradually over the course of 10 years.
The aid agreement signed by Israel and the U.S. in 2007 expires in 2018. As part of the agreement, Israel receives military aid totaling 3 billion dollars a year on average. During the negotiations on the new aid agreement, Israel asked that annual aid will amount to at least 4.6 billion dollars – 4 billion dollars a year for regular military purchases and another 600 million dollars a year for the development of missile-defense systems. Overall, the Israeli request amounted to at least 46 billion over the course of 10 years.
The U.S. administration rejected the request and offered instead 3.4 billion dollars a year in aid for regular military purchases and another 300 million dollars for the development of missile-defense systems. It then agreed to expand the annual amount for missile-defense systems to 500 million dollars. Overall, it suggested aid amounting to 3.9 billion dollars a year, or 39 billion dollars over the course of a decade. However, the White House conditioned this offer on the amount being the absolute limit, meaning that Israel won't be able to ask Congress for budget increases for the missile-defense program for 10 years. After long deliberations, Israel also agreed to this condition.