U.S. Blocks Arms, Technology To Israel

TEL AVIV [MENL] 23 December 2006 -- The Bush administration has blocked
arms and technology transfers to Israel.

Israeli and U.S. sources said the State Department has blocked the
transfer of weapons and technology to the Jewish state over the last three
months. The sources said the halt reflected deteriorating relations between
the two countries since the end of the war in Lebanon in August 2006.

"Nobody will say openly that there is a problem," a government source
said. "But there is a serious problem that reflects the marginalization of
Israel in U.S. strategy."

The unofficial suspension of U.S. arms deliveries began in late
September, the sources said. They said the suspension halted the airlift of
air-to-ground and other munitions conducted during and immediately after the
Israeli war with Hizbullah.

"Several weeks after the war, the U.S. supplies stopped," the source
said. "There was no real explanation."

The sources said the administration has held up a list of weapons
requested by Israel in wake of the Lebanon war. They said the weapons and
equipment -- including the Joint Direct Attack Munition, or JDAM -- were
meant to replenish munitions and other stocks in preparation for a larger
war that would include Syria in mid-2007.

"The administration has not rejected any Israeli request," a U.S.
official said. "Instead, the State Department and Defense Department have
said that all requests must be examined."

The administration refusal to approve the Israeli requests has also
hampered military cooperation between the two countries. In November, the
Israel Air Force canceled plans to send delegations to the United States to
examine air systems and munitions.

A U.S. official said the White House was deeply disappointed by the
Israeli failure to defeat Hizbullah. The official said the war undermined
U.S. confidence in Israel's military and government.

"The word in the White House was that Israel lost the war," the official
said. "That alone led to a plummet in Israel's stock in the administration,
particularly the Pentagon."

The U.S. refusals have also hampered Israeli defense programs. The
sources said the State Department has prevented the transfer of data and
technology, even from projects that included Israeli participation.

In one case, State prevented Northrop Grumman from providing details of
its Skyguard laser weapon, which the company has sought to sell to Israel.
The ban led to the suspension of Israeli negotiations to procure Skyguard,
designed to intercept short-range rockets and missiles.

The sources said the halt in U.S. weapons exports to Israel was designed
to assuage Saudi Arabia. They said Riyad has increasingly linked regional
cooperation with Washington to pressure on Israel to halt attacks on
Palestinian insurgency strongholds in the Gaza Strip.

"The White House believes that Saudi help is vital for the United
States in Iraq," a diplomatic source said. "There's nothing like stopping
the weapons flow to Israel to show the Saudis that the United States means
business."