observation that again was discussed at some length in the region. There has been a fixation on the conference, almost an obsession with the conference, both in the Arab countries and in Israel. The one has exaggerated what a conference can do, and the other has been overly fearful of what a conference could do.

Mr. HAMILTON. What is Israel's position? Does Israel here prefer an international conference that is opened just by the United States and the Soviet Union?

Ambassador MURPHY. No. There is no such position.

Mr. HAMILTON. What then is Israel's position on an international conference?

Ambassador MURPHY. Israel's position varies with Israel's lead

ers.

Mr. HAMILTON. Let's take the number one leader.

Ambassador MURPHY. He doesn't like an international confer

ence.

Mr. HAMILTON. What does that mean? We just said a moment ago that there is no peace process if there is no international conference. If you take the position that there will be no international peace conference, then it follows that there will be no peace process. Is that correct? Mr. Shamir's position results then, in no peace process. Am I right?

Ambassador MURPHY. Right, sir. No peace process as we see it working, at least.

ROLE OF THE PALESTINIANS IN AN INTERNATIONAL CONFERENCE

Mr. HAMILTON. Have we discussed with any of the Palestinians their participation in the international conference?

Ambassador MURPHY. We have discussed, and we regret that the Secretary was reduced to having to give his statement to the television in East Jerusalem rather than to the Palestinians who were going to meet with him that night in February.

Mr. HAMILTON. Why did the Palestinians not meet with him?
Ambassador MURPHY. They were intimidated.

Mr. HAMILTON. Intimidated by whom?

Ambassador MURPHY. Intimidated by phone calls purporting to come from, some from the PLO and some just from anonymous callers.

Mr. HAMILTON. So the PLO said to those Palestinians that might have been willing to meet with the Secretary, if you go there we're going to hurt you in some way, is that right?

Ambassador MURPHY. If you go there, in an arrangement where only representatives resident in the territories are present, we'll hurt you. We're happy to see that meeting take place if there are Palestinians from outside of the occupied territories present. Let them be American Palestinians, Palestinian Americans, let them be anyone else. But not just the residents.

Mr. HAMILTON. At this international conference, what do you envisage for the Palestinians? Can they only come to that conference if they are part of the Jordanian delegation?

Ambassador MURPHY. We are saying that all parties that come would have to accept, the price of admission is acceptance of 242, 338, renouncing violence and terrorism, and readiness to negotiate

with one another. Now they would be there in a joint delegation. and they would be there throughout because the problems of the territories can't be resolved without the Palestinians.

AREAS OF SELF-RULE DURING A TRANSITION PERIOD

Mr. HAMILTON. Let me ask you about the agreement for self rule during the transition period. What areas of self rule other than defense and foreign policy would be outside the parameters of discussion during this interim period?

Ambassador MURPHY. Would you repeat that, sir?

Mr. HAMILTON. We're talking here about some sort of self rule during an interim period, the transition period. What do we mean by "self rule"? I'm trying to put a little substance on the phrase self rule. Would foreign policy questions and defense be a part of self rule in this context?

Ambassador MURPHY. Speaking as the American position, as you know, we do not support an independent state. So we are not looking forward to a disposition of the territories where the territories would end up having a foreign policy and defense policy because those are attributes of an independent state.

Mr. HAMILTON. For example, would the Palestinians have control of the local economy?

Ambassador MURPHY. Yes. The local economy, local judicial, local political system.

Mr. HAMILTON. But they wouldn't control defense or security? Ambassador MURPHY. Right.

Mr. HAMILTON. Would they have a police force?

Ambassador MURPHY. Yes, there would have to be a police force. Mr. HAMILTON. But obviously not an army.

Ambassador MURPHY. Right. I wouldn't want to get involved in discussing what exactly would be in and would be out at this point in time. But I can agree with what you've given in that short list of responsibilities. The idea is a rapid achievement of control over their political and economic decisions.

ELECTORAL PROCESS IN THE WEST BANK AND GAZA

Mr. HAMILTON. What type of an electoral process do you see for the West Bank and Gaza?

Ambassador MURPHY. That has to be worked out.

Mr. HAMILTON. Do the Israelis support an electoral process for the Palestinians?

Ambassador MURPHY. They vary. They have different ideas. about it.

Mr. HAMILTON. What is the government's position?

Ambassador MURPHY. It varies.

Mr. HAMILTON. What is the Prime Minister's position?

Ambassador MURPHY. I think there is concern at this point in time with the violence in the territories that the idea of having an elections concept being that in such disturbed times elections would produce the most extreme representatives.

Mr. HAMILTON. Do you believe those elections would have to be carried out with some kind of international supervision?

Ambassador MURPHY. We're not going to get into defining just how they would be carried out at this point in time.

Mr. HAMILTON. Who would vote in those elections?

Ambassador MURPHY. You're talking about the Palestinians. The residents.

Mr. HAMILTON. You have indicated that the Israeli-Jordanian talks on the interim regime were meant to be finished in a six month period. Is the time for elections included in that six months? Ambassador MURPHY. No, they would come, however it is to be managed as to who takes responsibility for negotiations of the final status would be after the conclusion of the transitional period.

ISRAELI ELECTIONS AND THE U.S. PEACE PLAN

Mr. HAMILTON. There has been some discussion in the paper that Israel may hold elections soon. If Israel holds elections what happens to this peace plan?

Ambassador MURPHY. This question is, well there are two aspects of it. Elections are coming no later than I think the date is November 1st or the first few days of November. The question being discussed at the moment is whether there are going to be early elections. But under the Israeli system, once the Knesset passes an electoral law there has to be 100 days allowed for everything to do with the elections. You are rapidly getting to the point where it's academic to talk about early elections.

Mr. HAMILTON. So if Prime Minister Shamir says we're going to have elections in Israel, then this peace effort probably collapses. Ambassador MURPHY. No, I don't see any reason to assume that, because look back at the history of 1973. Israel delayed its elections that were scheduled for about the time of the October war. They were delayed to the last day of December of 1973. They entered into negotiations at Geneva with, in fact in an election period.

Mr. HAMILTON. Do you believe that this proposed time line that you've outlined-an international conference in April and then the start of transitional talks in May and all the rest-can go forward with Israel in the middle of an election?

Ambassador MURPHY. Yes. We think so. The experience is that they went forward in a very difficult political moment with the negotiations at Geneva and the disengagements of the Sinai.

PEACE PLAN TIMETABLE

Mr. HAMILTON. How long will this interim transition period last? Ambassador MURPHY. We've suggested it should be three years. Mr. HAMILTON. Is that a position that is acceptable to Jordan? Ambassador MURPHY. No one has said yes, no one has said no. Mr. HAMILTON. They haven't specifically commented about that three year period?

Ambassador MURPHY. No. Jordan was always uncomfortable with the transitional period which was up, which was five years under the Camp David period.

Mr. HAMILTON. Do you envisage that when you begin negotiations on the final settlement that the Jordanian-Palestinian group would represent the Palestinians? Is that the group that will be involved in discussions on final status?

Ambassador MURPHY. Yes. There may well be a way of bringing into that group after the transition arrangements people who were not in it to start with. We don't have any fixed ideas on that.

U.N. RESOLUTIONS 242, 338 AND THE PEACE PROCESS

Mr. HAMILTON. Prime Minister Shamir has argued in response to the letter from the 30 Senators that Israel fulfilled its commitments to UN Resolution 242 with the Camp David Accords, and that that resolution does not apply to the territories. How do you react to that?

Ambassador MURPHY. We think that 242 applies in all their parts to the territories, 242 and 338.

Mr. HAMILTON. I am curious about the basis of the Prime Minister's thought here. I don't think I saw it spelled out anywhere. Does he argue that 242 applies only to the Sinai and the Camp David Accords?

Ambassador MURPHY. That is his interpretation of 242. Beyond that I don't know.

PALESTINIANS AND THE PEACE PROCESS

Mr. HAMILTON. We had some reports that Ambassador Walters went to Tunis recently to meet with Palestinian officials. Can you comment on this?

Ambassador MURPHY. He went to Tunis recently and did not meet with Palestinian officials.

Mr. HAMILTON. It's very hard for this process to go forward if there aren't some Palestinians to talk to, isn't that correct?

Ambassador MURPHY. It's impossible.

Mr. HAMILTON. If the Palestinians don't come forward with representatives, then the process won't work.

Ambassador MURPHY. We have said for some time now that there are out there lots of serious and credible men who have standing and stature in their community. We have said that there is no point in trying to even conceive of a negotiation if the Palestinians who try to come to the table are such as would drive Israel away from the table. There is no Israeli leader who will sit with the executive of the PLO. That's a given. That doesn't mean there aren't credible Palestinians acceptable generally who can't come forward. But it is going to demand restraint.

Mr. HAMILTON. So any Palestinian could come forward and sit at the table if they accept 242 and renounce terrorism. As you put it a moment ago, that's the ticket of admission, right?

Ambassador MURPHY. Yes.

Mr. HAMILTON. Mr. Levine?

EUROPEAN-ISRAELI ECONOMIC AGREEMENTS

Mr. LEVINE. Thank you, Mr. Chairman. You've asked a number of the questions that I was going to ask.

Mr. Secretary, let me go back to a colloquy that you briefly had with my colleague Mr. Torricelli when he raised the issue of Gaza. It seems to me that your response to that question and to the series of questions that he asked, raises one other point. I know it is a

view that we share, but I think it needs to be at least placed in a little bit clearer focus than perhaps it has been in recent days.

The point is this: whether it is Gaza or whether it is the entire peace process, obviously Israel cannot do it alone. Israel needs a negotiating partner. Israel needs an interlocutor. Regardless of what the Israelis agree to vis-a-vis the Shultz plan, it all becomes irrelevant if there is not a serious Arab partner for peace. And in fact while Israel is obviously deeply split on how to make peace with the Arabs, on the other hand even today the Arabs seem to be vacillating on the fundamental question of whether to make any sort of peace with Israel.

I just thought that ought to be placed on the table in the context of what has been occurring, because as we watch developments this week, it is important not to forget that reality, which I think came forth in your responses to some of the Chairman's questions as well.

I have two or three specific questions that I still want to raise with you.

Last week, it was reported that the European Parliament voted down two Europe-Israeli economic agreements. One dealt with tariffs on Israeli agricultural products, and another with development loans to Israel. Apparently these actions were taken by the European Parliament as some form of sanction against Israel in light of the developments on the West Bank and Gaza. I was wondering whether we have communicated our view of these actions to the Europeans? Do we support these actions? Do we believe them to be productive or counter-productive? And have we expressed an opinion of ours to the Europeans with regard to these actions?

Ambassador MURPHY. I'm afraid I was traveling last week at that time. Let me get an answer for the record on that. [The information follows:]

The failure of the European Community to conclude the two_trade agreements with Israel rests on an unprecedented outcome in the European Parliament, where the absolute majority required to ratify the agreements was not achieved. The EC Commission intends to submit the agreements to the Parliament again this month (April) for a vote. If the agreements are again not ratified, the USG can approach the EC Commission to encourage its more vigorous lobbying on their behalf.

Mr. LEVINE. Could you simply answer with regard to your view as to whether these actions are productive or counter-productive? Ambassador MURPHY. My understanding of them, but I would prefer to get you a more precise answer, is that the community or the Parliament saw it that they wanted to use certain agreements with Israel as leverage on getting Palestinian agricultural products exported directly to the European market. They have held back those agreements for the moment because they don't feel that Israel has given the facilities for export to the Palestinian farmers that the Europeans wanted given. Whether that is effective or not, I am not in a position to judge. But I think that was their reasoning.

Mr. LEVINE. I would appreciate a response for the record on whether we have communicated anything to them. I guess I'm a little bit surprised by your answer because it sounds somewhat different from an answer that the Secretary gave to a different question, but which perhaps is an analogous one in the context of this