AMBASSADOR SHOVAL: Thank you very much, and hello to everyone. The timing of this event couldn't have been better or worse because, as you were just told, my intention really was -- well, basically to take leave of you, and to briefly review, perhaps, these very unusual two and a quarter, two years and four months which I have spent in Washington as the ambassador of Israel to the United States. I realize, of course, that, as the British used to say in olden times, the recent unpleasantness will probably come up, and I don't know if I have too many answers, but we can refer to that and relate to that later on. Let me say first of all, though obviously not by design, I came in rather tumultuous days. I think my official appointment was made on the very day that Saddam Hussein decided to invade Kuwait, and then we had the Temple Mount affair, which occurred more or less on the day I arrived here, and just not to let me forget that not everything has been solved here, we have the most recent occurrence, just days before I leave.

The backdrop, the background at the time of my appointment, just to remind ourselves, was the temporary breakdown of the first installment of the peace talks at the time -- or the -- not peace talks, because we didn't have actual talks, but of the peace initiative which professionals sometimes call "Baker I," and the ensuing tensions, and the reconstitution of the Israeli government under the head of Mr. Shamir. That was more or less the behind-the-scenes political reality at my appointment -- at the time of my appointment. Then, as I said, the Gulf crisis, the Gulf War, incidents like the Temple Mount affair. The end of the Gulf War, and the events leading up to the Madrid conference, and the very active role my embassy here played in helping to set up the terms, the ground rules, the parameters for the Madrid process, and I'm referring specifically to the mutual understandings between the United States and Israel, assurances, and so on and so forth, which were worked out at the time, both in Jerusalem, but no less so here in Washington between the embassy and the State Department and the administration, and then of course, the Madrid conference itself and its aftermath, because, as I will mention later on, I also had the good fortune to be appointed by Prime Minister Shamir and reappointed by Prime Minister Rabin as a member of Israel's team to the negotiations, in the negotiations with our Arab neighbors. Specifically, I was a member of the team negotiating with the Jordanians and Palestinians.

One very major item, obviously, in my activities during almost the whole period, almost the whole period, was the matter of the loan guarantees, which more or less began when I arrived here, and really was not finally formally concluded with regard to the last initialing of the last document till just a few weeks ago. The we had elections in Israel, change of government in Israel, and a change of administration, of course, here in the United States. And just to mention a few headlines in other matters, this was a period of, I would say, reassessing, but basically also reinforcing and strengthening the strategic understandings between our two countries. Military understandings, agreements were forged in the last few months based on the experiences of the last few years, and I would say that Israel and the United States today have a closer understanding in these matters, perhaps, than ever before. These are more or less the bookends, if we can call it like that. Let me when I go a bit more into specifics start, indeed, with the peace process. Jonathan Swift, I think, once has said or written that -- he defined the word "vision", and he said that vision was seeing things invisible. This is not the way I would like to see our vision of peace.

I believe that that vision is very visible -- certainly will be very visible. And it goes beyond just the matter of ending the state of belligerency between us and our Arab neighbors. As a matter of fact, in the peace talks so far, both in the bilaterals and in the multilaterals, we are addressing quite a number of subjects which are part of this vision, whether it's water concerns -- which concern all of us -- whether it's ecological matters, whether it's other economic matters. And I'm not just talking about Israel and the Palestinians, but beyond Israel and the Arab states, including even states which are not part of the bilateral peace process, such as the Gulf countries. And I must say that my attitude is very much akin to the ideas which were expressed a few years ago by former Secretary of State Shultz when he said we can no longer, talking about the Middle East, certainly talking about Israel and the Palestinians and, perhaps, even Jordan, we can no longer talk in terms of hermetical -- hermetic borders, Chinese walls; there will have to be a large measure of cooperation and coordination whatever the political formula will be. And that is, indeed, our vision -- our vision -- of peace in the Middle East.

I think the peace process -- that's the term -- has probably been until now as successful as could have been expected, given the fact that we are dealing with a hundred-year-old conflict -- some people say longer -- and that there are some very, very difficult problems to sort out. Now, I think you know that with Jordan specifically, there has been a great deal of progress. But what is perhaps less well known is that even with the Palestinians in the last round, before the last round broke off one day before its pre-agreed ending -- and I don't want to go overboard on that, but there was a certain rapprochement, a certain meeting of the minds on questions relating to a possible common agenda. And as I've said often before, when we talk about peace, a common agenda is not a laundry list; it is a list which reflects the actual questions which will have to be -- and which are, indeed, on the table. And I believe that once the talks will resume, and we shall go into that a little bit later on, and if the Palestinians will cease to have unrealistic expectations, and if they will adopt a united strategy in these peace talks, and if they will not let themselves be negatively influenced by what I call the Arafat factor, I believe there is a possibility, a distinct possibility of making further progress without too much -- without too much delay, I hope. I will not go into the matter of Syria. The jury is still out, but there are prospects of adopting a common set of principles which could lead us towards further progress in the coming rounds.

Of course, these talks have been protected -- protracted, as I assumed they would be, and perhaps another reason not to have wars is not to have these on- going, on-going lengthy peace talks. But that is part of the situation, and I would say it is better to have -- even if it's the status quo, hopefully it won't -- it will not be a status quo, but it's better to have the status quo of talking than the status quo of fighting.

Let me say that, having been myself personally engaged in efforts to come to understandings with the Palestinian Arabs probably longer than anybody else on the Israeli negotiating team except for Elyakim Rubinstein, who has been involved longer and a lot more intensively than I have, I must say at the conclusion of my term of office that I felt especially fortunate to have been able to be part of the Israeli peace team and, as I said before, that I had the opportunity to contribute towards working out the rules for this process. And my major regret, perhaps, on leaving my post is that I shall no longer be able to do that, at least not for the time being.

I would like briefly to refer both to the peace process and the implications of the present Hamas deportees, temporary deportees crisis. I understand this is on everybody's mind. I would like to make it clear that in our view, Israel has made its point that it will not shrink from any measure needed, even at the risk of making itself temporarily unpopular, where the security of its people and the people under its protection, which means including innocent Palestinian Arabs in the territories, where that security is concerned. Israel will not allow, on the other hand, the peace process -- for the peace process to be stalled.

And I believe that the US -- I cannot speak for the US, but I believe that the US is sending a very clear signal that it will not let any sort of interference stall or interrupt the peace process or, God forbid, derail it all together.

But let me add to that that I believe that this is also a moment when everyone concerned, which really means the world community, but it very much means also the Palestinian Arabs in the territories and their delegation, the people with whom we actually sit at the negotiating table, should make it very clear that they distance themselves from terror and violence, because those who perpetrate violence and terror, like the Hamas, like the Islamic Jihad, want to disrupt the peace process, want to destroy the peace process. And that message must be sent for the sake of the peace process and for the sake of the Palestinians themselves.

And I would like to say that I am fairly confident, at least I hope so, but beyond that, that the peace process will indeed resume before too long. I can't measure it with a stopwatch, with a clock, whether it will be a matter of weeks or months. Hopefully it will be weeks rather than months, but the peace process will resume because everybody involved has too much at stake: I don't have to mention Israel; the Arab states, certainly the Palestinians, who would stand most to gain from a successful conclusion of this process and most to lose were it not to go on. And I think these realities will be stronger than anything else. As paramount as it may look at the present time, in retrospect it will perhaps look just like a blip on the screen.

Another reason why the peace process will go on, in my view, is because America, the sponsor, will continue to push it forward. And we commend her on that. And because America itself, from its own policy points of view in the Middle East, trying to create stability and to ascertain stability in the long run, also has a very important stake in this peace process. America's role so far has been very helpful -- I believe it will continue to be helpful -- finding the right balance of playing an active role and sometimes fading away from the picture when needed -- and sometimes these moments are also needed.

And basically, if we talk about the Palestinian-Israeli equation, unless the peoples involved themselves will feel it in their bones and in their hearts that they have to find a way of co-existence and to live together and accept that, and accept that reality may sometimes force them to accept that they cannot realize in totality all their aspirations and all their wishes and ideals, and so on and so forth, unless an agreement like that is reached between the peoples themselves, anything dictated or imposed or even prodded from the outside would not hold water for a long time anyway. So America's role will have to be activity on the one hand, activeness on the one hand, but also sometimes very diplomatic behind-the- scenes on the other hand.

Let me say in concluding that I look back at these two years and three months with a great deal of satisfaction, having come here in difficult times, leaving here with the relationship between the United States and Israel in a very good state, having overcome several crises on the way, living in the new situation in the Middle East, perhaps not the new world order yet, but certainly a new situation which does create the objective factual underpinnings for eventual peace, and also to have been very fortunate to have been in this country, been on my post when something has been going on with regards to Israel which is probably more important than anything else, and I refer to the ongoing immigration of hundreds of thousands of our people from the former Soviet Union, from Ethiopia, from other countries to Israel.

We have already received up to 500,000 people within the last 3-1/2 to four years. The absorption process is not easy economically, sociologically, but it's making progress. And we expect at least that same number -- that means another half-million -- within the next three to five years, possibly exceeding that, till the end of this century. That is Israel's real priority.

Of course, we don't have the luxury of defying logic, to have only one priority at one time. We have to look after our security, peace is a priority, but all these things are not contradictory. They all work to the same end. With peace, we shall better be able to absorb our immigrants. With an enhanced number of people in Israel, both Israelis will feel more self- confidence, and I suppose that those in the Arab world who still exist who still have not acknowledged in their hearts and minds Israel's permanency will be induced, hopefully, to change their views as well.

So, I would only say as my final remark I enjoyed a very good working relationship with all of you and some of your colleagues who are not here. I want to thank you for your objectivity, for your professionalism, and maybe we'll have some contacts in the future, although right now I don't know if that will be so or not.

Thank you very much.

MR. HICKMAN: Thank you, Mr. Ambassador. Questions, please. Jim?

Q: Mr. Ambassador, I'm Jim Anderson, (UPI ?). I'm not sure I understand the cause for your optimism about the peace process being able to survive this -- (inaudible). And taking it in the context of the US decisions to be made in the next week, if the Security Council does go ahead with the sanctions resolution, and the US should veto it, the Arabs say that they will -- (inaudible) -- peace talks. If, on the other hand, the United States does not, I presume that Israel will find it impossible to come back to the peace table, at least in the foreseeable future.

In that specific context, can you explain to me how the United States would manage things so to keep the peace talks going?

AMB. SHOVAL: Well, first of all, the Arab states have not declared, to the best of my knowledge, that they will walk away from the peace process. The Palestinians have made a statement like that, but the Syrians have not, nor have some of the other Arab countries.

Number two, because of what I said before -- namely, that this may be an unprecedented opportunity for everyone concerned with the disappearance of the Soviet Union from the scene, with the end of the Gulf War and America's enhanced position as the only superpower left in the world, with the beginning of a realization, although not always acknowledged, by the Arab peoples and states in our region that Israel is not the main reason for instability in the Middle East, certainly not the main danger -- we never thought we were a danger to any Arab country, we had no designs on any Arab country -- but the beginning of a realization that there are other threats much more serious, whether it's Moslem fundamentalism or whether it's political occurrences related and exploited by Iran, for instance -- all these factors have brought everyone to the peace table and, I believe, will certainly, after this incident -- incident -- this occurrence will have been settled the way it has been agreed upon now -- people will go back to the peace process.

What I would like to say, however, it would be a pity if there were to be too long a delay. The late President Sadat used to speak very often of the need for momentum. You remember that. And there is a need for momentum here. If the talks resume very soon, and I know there will be some interruptions because of Ramadan and then Passover, but if they were to resume very soon, it is good. If they will resume only, let's say, in April or May, it is still good but it would not be the -- would not have the same advantages of momentum as they would if they would resume earlier.

With regard to the Security Council, I can only refer you to what Secretary Christopher has said. In his view, in America's view, and, of course, in our view, Israel has complied with Security Council Resolution 799. And I'm not - - I don't want to express my view, although I could, on the lack of balance in that resolution, but that's history now, let's hope so, and we should all look forward to the peace process and not to problems which could disrupt it, temporarily or not.

Q: (Name and affiliation inaudible.) Mr. Ambassador, permit me to ask three questions in one question. First of all, are you pleased with the American reaction (taken by ?) Warren Christopher yesterday? And do you expect him to fly to the area soon? And third, what is -- (inaudible) -- on the role which the Secretary General's report has proposed -- (inaudible)?

AMB. SHOVAL: Well, number one, we are very pleased with Secretary Christopher's position, the United States' position as expressed by Secretary Christopher yesterday. I must say beyond that, I'm very pleased with the very close rapport and exchanges of views which have been going on between our two governments over the last few weeks on this matter.

Number two, I have read in the newspapers that Secretary Christopher intends to go to the Middle East. And I see -- I have no reason to believe that these reports were false. When he is going exactly, I think the date has not yet been set, I think it's a very good idea to meet the different leaders in the area to get a first-hand acquaintance with them, as Jim Baker had in the past. So, we welcome that.

Number three, although you didn't ask that question, and I won't go into detail, let me just say we are satisfied with the role Egypt played and is playing in trying to get obstacles for the renewal of the peace process, to get obstacles off the table.

With regard to the Secretary General's report, UN Secretary General's report, no, we were not happy with it. We thought, and we said so at the time, it was one-sided. It did not in any way refer to the provocation which Israel had, to the terror, to the agenda of the Hamas, and the agenda of the Hamas is to destroy the peace process and to destroy Israel. And to issue a report which just speaks about the consequences, just about the effect without speaking about the cause, I believe was not helpful and I must say that that view is shared by other powers as well.

Q: (Name inaudible), United Press. In your opening statement, you seem to indicate that, at least in your mind, there's some question whether Palestinians participating in the peace process are associated with Hamas and other --

AMB. SHOVAL: No. I hope that this was not --

Q: You said Palestinians should make it very clear that they have distanced themselves --

AMB. SHOVAL: Right. Well, I think because the Palestinians have so much at stake -- so do we -- in coming to a modus vivendi which will give them for the first time in history a chance to run their own lives in most walks of life and making progress towards solutions which are certainly something many of them have aspired for, they should make it very clear to their own people that the Hamas and the Islamic Jihad have a completely different agenda. They want to disrupt, to derail, to destroy the peace process.

And at a previous occasion in this very press club a few months ago, I even said that the Palestinian delegation which sits across us at the table, when they go home, they should tell the Palestinians in the territories, "Look, it's going to be a difficult process. It's not something -- there are no quick fixes for that. But we are making slow progress. And this is the chance." Instead of that, they often go back and broadcast a very negative, pessimistic image.

So, if I were a Palestinian, I could understand that some of them say there's no chance in this peace process and listen to more extreme messages. And that's where the Hamas succeeds. If the official Palestinians, and I believe they are the majority and I believe that most Palestinians want to live in peace with us and we want to live in peace with them, if they understand that we have a common interest, yes, they should distance themselves from extremists, just as Israel would and probably has distanced itself from extremists which may be there in Israel who are opposed to the peace process.

Q: If I could just follow up? So, are you saying that the Palestinians participating in the peace talks should publicly condemn --

AMB. SHOVAL: Yes, I am saying that.

Q: Saying they should --

AMB. SHOVAL: I am saying that the Palestinians in the peace talks should find a way to say "When we are negotiating peace with Israel, terror and violence by the hands of those who want to disrupt the peace process has no place." They should take this courageous action and make a courageous and honest call to their own people.

MR. HICKMAN: George, and then this gentleman down here.

Q: George Gedda, Associated Press. You made only one fleeting reference to Secretary Baker. How indispensable was Secretary Baker to the establishment of the peace process, and are you quite certain that it will prosper in his absence?

AMB. SHOVAL: That it will what?

Q: That it will prosper --

AMB. SHOVAL: Oh. Well, you know, I don't want to repeat all the well-known phrases about people not being indispensable and so on and so forth. There's no doubt that history will allocate to Secretary Baker probably a very, very important role, perhaps the most important role, in getting this process off the ground. And I had an opportunity to say to him a few days ago at a private occasion -- private event, sometimes the beginning is just as important, maybe more important, even than the continuation because to begin a process between Israel and the Arabs was a major -- what, a monumental task. And history will give him credit for that.

This does not mean that now that the process is on the way, and I believe it is on the way, that other statesmen could not play just as good a role, perhaps. Different attitudes. Everyone, of course, fulfills his role in accordance with his own inclinations and capabilities and so on -- character, but what Baker did will be historically remembered, I have no doubt.

MR. HICKMAN: This one, and then Bill, you're next.

Q: Steve Holmes (sp) from the New York Times. You mentioned earlier about -- that the top negotiators should in some way distance themselves from -- not -- the Arafat factor --

AMB. SHOVAL: Steve Holmes (sp) of the New York Times. Sorry.

Q (You're?) my press agent, then? (Laughter.)

AMB. SHOVAL: Yeah, okay. What do you pay?

Q: (Inaudible) -- not enough. I'm curious as to your assessment of the recent cabinet decision to allow private contacts with the PLO and what effect that - - you feel that might have on the peace process.

AMB. SHOVAL: Well, I am -- you're trying to get me into a minefield. The cabinet decision as confirmed by the Israeli parliament, by the Knesset, in essence meant that it would no longer be a criminal act -- a criminal act -- for Israelis to meet people who are members of the PLO unless these members of the PLO are actively engaged in plotting terrorism and engaged in terrorism -- not just in plotting terrorism. And as you probably know, most acts of terror and most acts of murder which are still going on, very much so in the territories, against Palestinians and others are still perpetrated by groups linked to the PLO. So it's not the question of some sort of idealized PLO. But that has been the decision of the Israeli government.

I do not think -- or I should say Prime Minister Rabin does not think, nor do I, that Yasser Arafat and some of his people are playing a helpful role in the peace process. As a matter of fact, we think that they are, to a certain degree, a clamp on progress. And if I may say -- if I can say this as an Israeli citizen, not just as an out-going ambassador, we are always concerned by the fact that, for instance, when Mr. Arafat makes one statement, a peaceful statement, his number two man, Mr. Kaddoumi, makes a completely different statement to a different audience, calling actually for the dismantling of the state of Israel. So whom are we to believe? This guy, or the other guy? Certainly, we have to be very, very careful in that respect.

Q: Can I follow up on that, please?

AMB. SHOVAL: Yes.

MR. HICKMAN: Sure.

Q: You said before that you -- you called upon negotiators to distance themselves -- (inaudible) -- the peace process. How can you ask the negotiators to do that with the cabinet, (with an action ?), in fact, going the other way, allowing contacts with those who, as you just --

AMB. SHOVAL: Well --

Q: Isn't that a little contradictory?

AMB. SHOVAL: I don't think so, and I was specifically referring to Hamas and the Islamic Jihad, which not only de facto but by their very ideology say "There's no room for the peace process, there's no room even for a little state of Israel," they disassociate themselves completely from the process, and this is something which must be understood, that when Hamas killed police sergeant Toledano, it was not in the territories, it was in Israel proper. They do not resent us, or let's say object to us because we are on the territories as a result of '67 and so on and so forth, as the official Palestinian position is.

They do not want to see the existence of the state of Israel or of the people of Israel as a national sovereign entity in that part of the world, and therefore we have to deal with that factor in ways which do not always make us popular, I'm sorry to say. But this is the dilemma which a free society, which a democratic society based on the rule of law has when it is confronted with people or groups which want to utilize, exploit that very democracy in order to subvert it, in order to destroy it. This is the situation which has arisen several times this century in other countries. It has arisen in this country in the second World War, it has arisen in Britain in the second World War, it has arisen in Germany in the '30s, it may arise again today in Europe.

How do we deal with it? How do we cope with it? Everything is permissible -- free speech, free activity, resort to the courts of law. Until we have an organization which has only one purpose -- to destroy us. So we embarked on something not so usual, not so conventional, but we had little choice. Whatever we do will be censored and attacked by someone, either out of a lack of comprehension, or sometimes even as a result of hypocrisy, I'm sorry to say.

Q: (Off mike) -- a couple of years ago, on your watch -- (inaudible) -- European Jews would -- (inaudible) --

AMB. SHOVAL: Not European, Ethiopian Jews.

Q: Ethiopian.

AMB. SHOVAL: Right.

Q: Could you tell us where they are, how they are doing, and whether (they have been ?) assimilated in the -- (inaudible)?

AMB. SHOVAL: Well, Israel embarked on two separate, perhaps conflicting experiments in that resort. First of all, there was an attempt to have all immigrants from whichever country, whether from Ethiopia or Russia -- you know, when one says the former Soviet Union, this doesn't just mean Russia, it means Azerbaijan, it means the Islamic countries in central Asia -- to get all these people settled together, more or less. This has not always worked out in the beginning, because people have customs and habits and traditions and so on and so forth. Where the main emphasis today is, and it's a very successful emphasis, it's with the younger generation, and the real important, successful melting pot is the army, because when kids from Ethiopia and from Azerbaijan and from Lithuania serve together in the army, boys and girls, and we don't have that sort of problem which you have now -- (laughter) -- I mean, we just don't -- we choose not to make it a problem. The new generation really forgets the antecedents of the their parents, and the young generation of formerly Ethiopian Jewish children has been very, very successful in schools, in universities. So I would say, after some very severe difficulties in the beginning, it's a great success now. And we have been there before -- 20, 30 years, I mean, there were Jews from African countries or from the Indian subcontinent who had different traditions. At first there were difficulties. Second generation, the difficulties are mitigated and disappear.

MR. HICKMAN: Over here next and then Joe.

Q: Susan Bennett (sp) with Knight-Ridder. Could you tell us about the role that Secretary Christopher played in the fashioning of the agreement on the Palestinians? Was it his suggestion that 100 be returned-- (inaudible due to background noise)?

AMB. SHOVAL: Well, I never had any doubt, just to put one thing aside, that the United States would make good its assurances with regard to the possibility of imposing -- of not imposing a veto if sanctions were to be proposed to the Security Council. That was not the main object of what Israel did. The main object of what Israel did was not to create a problem after a veto may have been or might have been imposed, not to create a problem with regard to the progress of the peace process. And I think just as it was the United States' very forceful wish not to come to the position where it would have to impose a veto, it was also Israel's very strong determination to -- not to create a situation like that, and in a very close, very close contacts between Secretary Christopher and the Prime Minister, these details were worked out. But there never was a question of pressure or confrontation. Both men had the same goal on their minds and their heart, and they tried to find ways how to reach it and they succeeded.

MR. HICKMAN: (Calls on reporter.)

Q: I think there's a follow-up here. Are you following up?

Q: Yes.

MR. HICKMAN: Sure. I'm sorry, I didn't see you.

Q: My name is -- (inaudible). I work for -- (inaudible) -- from Paris. Sir, on what basis the discrimination was made -- (off mike)?

AMB. SHOVAL: Is it a question or a statement?

Q: (Inaudible.)

AMB. SHOVAL: Well, no. First of all, I'm sure you didn't want to use the word "discrimination;" you wanted to use the word "differentiation," perhaps, or "distinction." Those who are lighter cases, where there is greater doubt to their extreme culpability, they were included within the 100. By the way, they are not going to be sent -- or all of them are not going to be sent to their homes, they're just going to be sent back and put back into exactly the same position they were in before they were temporarily deported. That means those who were in jail will go back to jail. Those who were under investigation will go back into investigation. Those about whom there may have been a mistake will be sent home. They will be -- I mean the film will be rolled back with regard to their situation.

The others are the more serious cases. And as you know, the period of the temporary expulsion was shortened from up to two years to up to one year. And the review of their cases individually will continue, will be intensified now. Which means that some of them may be given the chance to return if they want to choose that chance, earlier even than one year.

MR. HICKMAN: Joe?

Q: Can I follow-up? Did the United States --

MR. HICKMAN: I'm sorry, this gentleman was first, and then this gentleman, and then you're next. Q Mr. Ambassador, it looks as if you were saying this morning -- this is a follow-up on the question that -- (name inaudible) -- asked about your (process / prospects ?) for the peace process. It appears that what is happening here with the PLO and the Palestinian delegation rejecting the offer by Israel to reduce the situation, the 400, as you have just said, you indicate that this is now engaged in a bargaining process, which is not untypical in the Middle East: We want more than that, so we say no; therefore, the PLO may want recognition -- (inaudible) -- from the United States. Then the Palestinian delegation, which -- (inaudible) -- gets it guidance from the PLO, is saying this will give us an opportunity to get more from the United States in some way when the process is resumed.

But apart from that, there's also a feeling that the rejection by those in the territories, the deportees, that the extremists, the more vicious of them, are saying to others who are ready to go home or go back at least to their areas of land -- of living, that if you do, you will get what has already been done to some 600 Arabs who have been killed by other Arabs in the territories. I throw that out to get your impression if this is not at least part of the situation.

AMB. SHOVAL: Well, it may be part of the situation, not only maybe, it is. And the ongoing terror -- when I mentioned terror in the territories, it's not exclusively, perhaps not even principally addressed to Israel, or not addressed, it's not aimed at Israel so much as it is very often aimed at Palestinians in the territories themselves, which is part of the problem we have to face.

But on the other hand, no, I don't see any room for bargaining, neither on the part of Israel nor on the part of the United States. And it would be very strange when you have a party who would be the big loser from the peace process not going on, and the big gainer from it going on. If they would try to bargain, what are their bargaining chips, if I may ask? We offer them peace. We offer them flexibility. We offer them a modus vivendi. What do they have to offer to themselves if they do not re-engage us in these peace talks? This is quite -- I'm saying these words perhaps in a very undiplomatic fashion.

But Israel is a state, has its government, has its tasks; it can exist for many, many years without this process. We want it. We want to engage our Arab neighbors in peace. This is our ultimate aim. But for the Palestinians it is, I don't want to say the last chance, but it is a major chance. So why should they try to once again confirm what Abba Eban has said: They never miss an opportunity to miss an opportunity. Let's hope they will not miss this opportunity.

MR. HICKMAN: You, then you're --

Q: (Name inaudible), Voice of America. A question. Did Israel not foresee the implications of this mass expulsion? You laid it out very well. You said you're dealing with Hamas, Islamic Jihad. Hamas kidnapped that soldier, he was killed, and there have been other killings, you had to do something. But this was such a large measure. Was this not foreseen, the possible consequences of this? And if so, why not?

AMB. SHOVAL: Well, I suppose it was a sort of Hobson's choice. How do you deal with an organization like that without trying to tackle their infrastructure? Because the people who direct these activities and who finance them and who are the ideologues are sometimes more dangerous than the guy who actually throws a bomb or sticks a knife into somebody. And, as a matter of fact, by expelling these people -- and I must repeat time and time again that it was a temporary expulsion. It was, in our view and the view of most international lawyers in this country I have spoken to, not a breach of the Fourth Geneva Convention.

But we saw in it a way to disrupt the contacts between the leadership and the men in the field, and I think this has been relatively successful because, as you probably saw, the Hamas today is in a sort of disarray as a result of that. Whether we foresaw all the consequences, I'm not the person who can answer you about that. But sometimes you have to make tough choices and say to yourself this is going to be a difficult situation at the UN, international public relations, CNN, what have you -- CNN are now establishing, I think, a broadcasting station up there -- I'm not joking -- and still have to do something unpopular because it's the lesser of the evil. But I don't have a specific answer to all your questions.

MR. HICKMAN: Yes, sir?

Q: Ron -- (last name and affiliation inaudible.). If I can go back to the deportees, Mr. Ambassador, you mentioned that -- (inaudible) -- go back to the status in which they --

AMB. SHOVAL: Yes.

Q: And you've been working out this compromise. Did the United States at all perhaps raise issue with that particular --

AMB. SHOVAL: No. I think -- look, again I can't speak for the United States, but my feeling is that this was really what the United States wanted to achieve. Namely, those who told us, "You didn't have to deport them, even temporarily, you could investigate them and deal with them and so on and so forth while they are still in the territories," they really meant, "Okay, put them back there and start investigating and so on and so forth." So I don't think there was any issue in that regard at all. On the contrary.

MR. HICKMAN: Ron? Jeff?

Q: Mr. Ambassador, two questions, both related. Number one, would you comment on the allegations of Hamas activities in the United States? And number two, you commented earlier about the location of the murder of Sergeant Toledano.

AMB. SHOVAL: Yes.

Q: I have a feeling maybe you were restrained in --

AMB. SHOVAL: Well, I didn't feel restrained, unfortunately, and Sergeant Toledano was murdered when he left his home, his family home in Lod. He was not in the territories. And his body -- I mean, his hands were tied and his legs were tied and he was strangled to death and his body was dumped on the road between Jerusalem and Jericho. And, as Rabin said at the time, he never had the right to appeal or the possibility, not within 60 days or 90 days or one year or whatever.

With regard to possible Hamas activity or possible activities of Hamas-related persons in the United States, I will not go into that, but there are now three Hamas functionaries, activists who came from the United States, I understand are American citizens. They are under arrest in Israel, under investigation. And this to a certain extent underscores what I said a minute ago because the infrastructure in Israel and in the territories was disrupted as a result of the temporary deportation. They were in a state of disarray, and those people probably came over there with great amounts of money in order to restart the machine. But we apprehended them before they could do what they did. This doesn't mean that the danger has been eliminated. There are other people around and they may make other attempts, and we will try to cope with it, sometimes successfully, sometimes less so.

MR. HICKMAN: Steve?

Q: (Off mike.)

AMB. SHOVAL: Okay.

MR. HICKMAN: More questions?

Q: Thank you, Mr. Ambassador.

AMB. SHOVAL: Well, thank you very much. And we say in Hebrew -- (phrase in Hebrew) -- which means au revoir, and not good-bye. And thank you very much.