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Apart from the use of legal definitions to play down the importance of Palestinian losses, Israel tried vehemently, even before 1948, to reduce or even annul the amount of compensation it might be required to pay to Palestinians. To this end Israel has submitted a whole range of counterclaims, for example concerning the war damage endured by Israel in the Arab-Israeli War of 1948, since the Lausanne Conference in 1949. The most important of all counterclaims concerns the loss of property and bank accounts of Jews in Arab countries after becoming citizens of the State of Israel.
The claims concern first those properties lost after the armistice of 1949 in the West Bank and in East Jerusalem after their annexation by Jordan, as well as those lost in Gaza when it came under Egyptian rule. The second kind of counterclaims concerns properties left behind by Jews in the various Arab countries after they immigrated to Israel in 1948.
Jewish Properties in the Arab Countries
Beside claims on the properties owned by Jewish institutions in the West Bank, the most important counterclaim of Israel concerns properties and bank accounts left behind by Jews in Arab countries after their migration to Israel. The counterclaims concerning these properties have been employed by Israel in two ways. First, they have been used to defend the idea of an exchange of population which has been one of the basic principles of Zionism: Palestinian Arabs must be resettled and absorbed in Arab countries in exchange for the absorption of Jews from Arab countries in the new Jewish state created for this purpose in 1948. Moshe Sharett, the Minister of Foreign Affairs of Israel in 1951, officially advocated an Arab-Jewish exchange of populations. Don Peretz, Professor of Political Science at the State University of New York, reports that Sharett drew parallels with the mass migration of populations that occurred after World War I in Greece, Bulgaria and Turkey, and after World War II from Poland and Czechoslovakia into Germany, and more recently, between India and Pakistan. A restoration of previous situations did not happen in these countries and there would be no reason why it should occur in Palestine. The idea of population exchange was repeatedly used by Israel as a solution to the whole Palestinian refugee issue and in answer to Palestinian claims.
Secondly, Israel considers the properties of Jews from Arab countries left behind between 1948 and 1953 as a basis for a counterclaim against compensation of Palestinians who abandoned their land in 1948. In the Israeli logic, the fate of Palestinian claims is linked to that of the Jewish claims. From 1948 on, Israel countered claims made by Palestinians with the remark that the value of sequestered Jewish property had to be deducted from any amount owed to Palestinian refugees. One of the arguments used by Israel to annul the Palestinian claims has been that it had to bear the expenses of absorbing impoverished Jews originating from Arab countries who migrated to Israel. As the most significant number of properties left behind by Jews from Arab countries were located in Iraq, these properties became central to the discussions on compensation to Palestinians. Minister Sharett proclaimed that ‘an appropriate amount from any compensation which Israel would pay [to Palestinians] would be deducted for Jewish assets frozen in Iraq’.
Jewish Properties in the West Bank and Gaza
After the World War I, Zionist organizations and individuals bought land in some Arab countries. However, their acquisitions were centred mainly in what is now called Palestine (the West Bank, including East Jerusalem, and the Gaza Strip) and Israel (which at that time fell under the British Mandate). In May 1948, Jewish settlements built on these lands (excluding Israel) were evacuated. After the 1948 War, Jewish individuals, civil and religious institutions, and some companies also lost real estate in the West Bank, East Jerusalem, and Gaza.
The Zionist movement and King Abdullah of Jordan had established secret relations before the creation of the State of Israel. As a result, in 1949 Israel and Jordan reached a secret bilateral peace agreement. The agreement dealt, among other matters, with the borders of both countries and with the exchange of property and bank accounts in Israel belonging to Palestinians who were now living in the West Bank and East Jerusalem. Conversely, it dealt with Israeli Jews’ properties which had come under Jordanian control after the War of 1948.
The bilateral treaty between Jordan and Israel was strongly opposed within the Arab world. It considered King Abdullah a traitor as a result of his willingness to accept the loss of Palestine in exchange for property belonging to Palestinians after the armistice in Jordan. Talks between the two countries ended with the assassination of King Abdullah by a Palestinian in July 1951.
In the 1950s and 1960s, Jordan published lists in official government newspapers of villages and regions in the West Bank as well as individual properties which had been placed under control of the Jordanian Guardian of Enemy Property. The list did not make a distinction between Jewish and non-Jewish properties, as some of these properties belonged to Palestinian Arabs who had become citizens of the State of Israel after the armistice. The lists recorded properties that belonged to persons and institutions established in or affiliated to Israel. Fischbach reports that ‘unlike Israeli legislation toward Palestinian refugees’ land, Jordanian law preserved the legal rights of the ‘enemy’ landowners and did not allow for the sale of these properties. Some of this land was later rented to others, including UNRWA and Palestinian refugees who were allowed to settle in the ruined Jewish quarter of Jerusalem’s Old City.
After World War I, Zionist organisations had also tried to buy land in Syria and had succeeded in obtaining some land in the Golan Heights after gaining permission from the Ottoman ruler in Istanbul. Nevertheless, opposition of the Syrian rulers and population impeded the establishment of Jewish settlements on these plots of land. After its independence in 1946, Syria enacted a law that forbade foreigners from owning rural land, thus denying Zionist organizations the right to land ownership. Moreover, a Syrian legislative decree of 1952 made it impossible for foreigners who owned rural land to pass it down to their heirs. After the owner’s death, the property was appropriated by the Syrian state; compensation was subsequently to be paid by the Administration of State Lands. After 1948, Zionist organizations transferred the legal ownership of the land they owned in Syria to the State of Israel, which transferred it to the Jewish National Fund.
Jews and the Arab Countries
For centuries, several hundreds of thousands of Jews lived in the Arab countries among Christians, Muslims, and Druze Arabs. Some were descendants of the Jews expelled from Spain in 1492, others were European Jews who emigrated to different Arab countries, especially to Egypt and Palestine. The rise of Zionism and the strong hostility of the Arab populations toward this movement had its impact on the relation between Jews from Arab countries and the rest of the population. Opposition to the Zionist movement was sometimes directed against the Jews living in the Arab countries irrespective of whether they were involved in Zionist activities or not.
After 1948, the position of the Jews deteriorated. Several Arab countries enacted legislation that allowed the confiscation of Jewish property, and after the War of 1948-1949 permitted its sequestration in retaliation for seizure of Palestinian land by Israelis. By introducing such laws, these countries also wanted to prevent Jewish property from becoming a profitable asset for the State of Israel. The most widely documented loss of Jewish properties concerns Iraqi and Egyptian Jews.
The number of Jews living in the different Arab countries in 1948, the number of Jews who migrated to Israel, and the number of Jews who still live in these countries fluctuate in the different sources. Palestinian sociologist Jan Abu Shakrah gives an estimate of 700,000 Jews who left the Arab countries around 1948. Approximately 500,000 migrated to Israel; the remainder settled in Europe, the United States, Canada and Latin America. Estimates are that in addition to the approximately 110,000 Iraqi Jews who emigrated to Israel, 180,000 Jews came from Morocco, more than 50,000 came from Yemen, 30,000 from Libya, 20,000 from Tunisia, 16,500 from Egypt and 12,000 from Syria and Lebanon.
Jews in Egypt
Before 1948, some 75,000 Jews lived in Egypt. After the coup by the ‘Free Officers’ and the revolution of 1952 in Egypt, land reforms and nationalization hit all rich sectors of Egyptian society. In addition, different laws were enacted allowing the sequestration of the property of persons interned on security charges. Some were Jews who were suspected of supporting Israel; others belonged to the communist party, which had been forbidden by the new revolutionary government. Many Egyptians, among them Jews as well as wealthy foreigners, left Egypt after their businesses were nationalized as part of the policy of Gamal Abdel Nasser who, after he became president in 1954, tried to transform Egypt into a socialist state. British and French nationals as well as stateless Jews were also expelled from Egypt after sequestration of their property. Egyptian laws forbade the export of valuables. Around 23,000 Jews left Egypt between 1956 and 1958. A third wave of property seizure occurred after the 1967 Arab-Israeli War. Hundreds of Jews were forced to leave Egypt without their assets. In total, around 30,000 Jews emigrated from Egypt to Israel between 1948 and 1972.
Jews in Iraq
In 1948, an ancient indigenous Jewish community of 135,000 people lived in Iraq. In March 1950 a law was enacted in Iraq that dealt with the withdrawal of Iraqi nationality. The law intended to prevent Iraqi Jews from migrating to Israel while holding the Iraqi nationality. Under the new law, Jews were permitted to leave the country twelve months after signing a document issued by the Ministry of the Interior, leading to the forfeiture of Iraqi citizenship. The loss of Iraqi citizenship would not result in loss of ownership of any property in Iraq. unexpectedly, thousands of Iraqi Jews took advantage of this law and left the country with the help of the Israeli government. In an attempt to stop the drain of capital caused by the emigration of wealthy Jews, the Iraqi government passed another law in 1951 that had disastrous consequences not only for Jews intending to leave the country, but also for those who had already left after January 1948. This new law allowed the freezing of assets of ex-Iraqi Jews and the sequestration of property of those still waiting to leave Iraq. Although the estimated value of assets left by Jews in Iraq varies enormously, depending on the sources, it is certain the value of the lost properties is considerable.
Jews in Libya
A strong link between Libyan Jews and Zionism developed under the British Military Administration (1943-1951). In the decades prior to 1948, the Zionist movement had shown interest in Libyan Jews and had encouraged their emigration to Palestine. ‘Zionist pioneering’ in Libyan Jewish youth movements became an important source of manpower for drafting by the Zionist army, the Haganah. The relationship between the Jewish population and the Zionist movement was an important reason for the animosity between Jewish Libyans and the rest of the population and in November 1945 culminated in riots in Tripoli and its vicinity, which claimed the lives of approximately 130 Jews.
Of the 40,000 Jews who lived in Libya, 30,000 moved to Israel between 1948 and 1951, leaving behind their property. After the country became an independent monarchy in 1961, laws were enacted allowing the sequestration of properties. The laws did not explicitly affect Jewish property but targeted the property of people who allegedly had ties with Israel. According to Fischbach: ‘The law allowed the freezing of the property and bank accounts of persons or institutions who were in Israel, who were citizens of Israel, or who allegedly were working on Israel’s behalf’. At the time of Colonel Muammar Gaddafi’s coup in 1969, the number of Jews in Libya was reduced to 500. According to some sources, Gaddafi confiscated Jewish property and cancelled all debts owed to Jews. It is believed there is no longer any Jewish presence in Libya.
Jews in Syria and Lebanon
After the 1948 War, 30,000 Syrian Jews left the country and emigrated to Lebanon, Italy and Israel. They succeeded in liquidating their assets, although their bank accounts were frozen by the Syrian government in 1949. It is not clear whether the government of the newly independent country froze the bank accounts of all citizens who left the country after independence or if the measure applied only to Jews. Lebanon did not take any action against the 5,000 members of the Lebanese Jewish community.
Jews in Yemen
The Zionist movement encouraged Yemenite Jews and Jews of Aden to migrate to Israel, and flew nearly 49,000 of them to the Jewish state in Operation Magic Carpet between 1949 and 1950. According to Fischbach, information about lost properties of Yemeni Jews is not available. The members of the Yemenite Jewish community still living in Yemen number circa 200. Despite attempts by different parties to convince them to emigrate to Israel and despite the deteriorating political situation in the country, the remnants of the Yemeni Jewish community refuse to leave Yemen. According to Moshe Nachum, President of the Israeli Federation of Yemenite Jews, ‘one of the main factors deterring this small community from emigrating to Israel is the financial aid provided by members of the Jewish Satmar community in the United States, which is known for its radical stance against Zionism and the State of Israel’. Another reason mentioned for staying in Yemen is the fear of loss of property.
Claims and Counterclaims Today
The World Organization of Jews from the Arab Countries (WOJAC) was founded in 1975. This organization, which ceased to exist in 1999, allowed Jews who originally lived in an Arab country and lost material assets upon leaving to fill out forms detailing their lost assets in view of future claims. The WOJAC noted that the absence of documents or precise details would in no way prevent the proper registration of the declaration of material losses.
On an international level, the linkage between the property of Jews from Arab countries and abandoned Palestinian land is receiving more and more support. In 2000, American President Bill Clinton linked the Palestinian refugees‘ claims to those of Jews originating from Arab countries. He mooted the idea of establishing an international fund to compensate both Palestinian and Jewish refugees. In April 2008, the US House of Representatives passed a non-binding resolution urging that every reference to Palestinian refugees raised in international forums be matched by a similarly explicit reference to the uprooted Jewish communities originating from Arab countries. In February 2010, the Knesset, the Israeli Parliament, adopted a law under which any Israeli government entering into peace talks had to use this opportunity to advance a compensation claim for those who had become Israeli citizens. This law is meant to create a connection between the Palestinian refugee problem and that of Jews from Arab countries.
Most Palestinians firmly refuse, on legal and political grounds, to accept the linkage between the claims for compensation to Palestinian refugees and the fate of Jewish properties left behind in Arab countries. They state that they are not responsible for the policy of the individual Arab countries towards their respective Jewish citizens. The losses of Jews from Arab countries can therefore not be connected to the amounts of compensation Israel owes the Palestinians nor have any influence on their claims.
The consistent position of the Palestine Liberation Organization (PLO) regarding these claims is to refuse discussion of the subject in bilateral negotiations with Israel. This point of view has been repeated by Palestinian delegations whenever the subject has been brought up by Israel. This was the reaction of the Refugee Working Group which was created as part of the multilateral peace talks in the wake of the October 1991 Madrid Conference. In its second plenary session in Ottawa the Palestinians rejected, first, the Israeli statement that a population exchange occurred leading to the replacement of the Palestinians who fled in 1948 by Jewish immigrants from the Arab world.
Secondly, they rejected the linkage made by the Israeli delegation between compensation to Palestinians and Jews from the Arab countries. This issue should instead be raised with the respective Arab countries of origin of Jewish immigrants, not the Palestinian representation, they reasoned. Daoud Barakat head of the PLO’s Department of Refugee Affairs, repeated this stance in 1999: ‘There is no linkage here. Israel has to negotiate directly with Lebanon, Morocco and Egypt. I do not represent those countries.’ At the Camp David II negotiations, PLO negotiator Yasser Abed Rabbo repeated this argument: ‘This problem has nothing to do with us. Bring it up with the Moroccan authorities, the Yemenis and so on.’
Besides refusing to accept the linkage between the two issues, some Palestinian scholars such as Abbas Shiblak argue that Arab Jews were not expelled from the Arab countries. The use of the terms ‘Myth’ and ‘Lure of Zion’ to describe the migration of Jews from Arab countries, is testimony to how they regard the basis of these claims. Some observe that the migration of Jews to the future Jewish state has always been the core idea of Zionism and that Israel endeavoured to invite Jews from Arab countries as well as elsewhere in the world to leave their country of origin and migrate to Israel. Without Jewish migration to Israel, Zionism would have been a failure.
Therefore, according to these publicists, most of the Jews who left Arab countries were not ‘expelled’ but left voluntarily after pressure by Israel. Nevertheless, they consent to the idea that the birth of Zionism worsened the position of Jews in Arab countries, especially after the 1948 War. According to Sir Francis Humphreys, Britain’s Ambassador in Baghdad in 1948, ‘Zionism has sown dissension between Jews and Arabs, and bitterness has grown up between the two peoples, which did not previously exist’. Publicist Naeim Giladi describes the freedom and flourishing cultural, political, and economic life Jews enjoyed in Iraq before 1948. Their integration into Iraqi society came to an end after the aims of the Zionist movement became known in Iraq and other Arab countries. Following the ensuing war and hostilities, many Jews migrated to Israel.
Operation Ali Baba
According to Abu Shakrah, many factors lay at the heart of the mass emigration of Jews from Iraq. These included the pressure exerted by Britain and the United States for a transfer or population exchange. Under this scenario around 100,000 Palestinians were to resettle in Iraq in exchange for 100,000 Iraqi Jews, who were to be resettled in Israel. Abu Shakrah argues that denaturalization laws enacted by Iraq divesting any Iraqi who wanted to leave the country of Iraqi nationality, were passed under pressure from Britain on the then Iraqi government. These laws led to the emigration of 40,000 Jews to Israel, and the transfer of 10 million Iraqi dinars, which caused an unexpected drain on Iraq’s economy. The denaturalization laws were therefore followed by laws that froze the assets of Jews who applied to relinquish their Iraqi nationality. Thousands of Jews left Iraq and were brought to Israel following a campaign organized by Israel, ‘Operation Ali Baba’.
This operation was meant to encourage Iraqi Jews to migrate to Israel, using extensive propaganda internationally and inside the Iraqi Jewish community. An important component of ‘Operation Ali Baba’ seems to have been a series of five bomb attacks on Jewish targets from April 1950 through June 1951. One year later, Mossad agents and British officers were identified as responsible for the attacks, while several Israeli sources confirmed that the bombing campaign was carried out by an Israeli Zionist commander, Mordechai Ben-Porat. The goal of the bombing was to generate fear in the Jewish Iraqi community in order to encourage them to leave Iraq. Abbas Shiblak, Palestinian historian at the Refugees Studies Centre in Oxford, notes that the bombing campaign could only have been carried out following decisions taken at a high level in the Israeli government and with the personal knowledge of Yigal Allon, who at that time was in charge of external Mossad operations, and of the then Prime Minister David Ben-Gurion. ‘Operation Ali Baba’ also entailed an evacuation plan to bring thousands of Jews from Iraq to Tel Aviv.
Whatever the reasons for the emigration of Jews from the Arab world to Israel, some Palestinians, such as Rashid Khalidi, a well-known Palestinian scholar, consider that any claim of an Arab Jew who left or was forced to leave the Arab world is a ‘perfectly legitimate claim, one which might conceivably be resolved in tandem with reparations to Palestinians’.
Shlomo Gazit, retired general in the Israeli Defence Forces, and Lex Takkenberg, former Deputy-General of UNRWA in Syria, share the opinion that Israel is incontestably entitled to raise the issue of Jewish property abandoned in Arab countries. However, Israel should not use this issues as a means to avoiding admitting responsibility for the creation of the Palestinian refugee problem or to refusing the payment of compensations to Palestinian refugees. The issue should be resolved bilaterally with the Arab countries involved, or during an international conference to deal with the multilateral aspects of the refugee problem.
Palestinian Claims, German Reparations
One of the arguments Israel used to refuse the payment of compensation to Palestinian refugees was the costs it had to bear for absorbing Jewish immigrants. The argument could not stand after the1952 negotiations between the World Jewish Congress and the Federal Republic of Germany about reparations by Germany for Nazi crimes against Jews before and during World War II.
A final agreement between Israel and the Four Powers that controlled Germany at the end of World War II was reached by the end of 1952. West Germany agreed to pay reparations to victims of Nazi crimes amounting to one billion USD. This would be paid over 14 years in goods and as allocations for Jews living outside Israel. The rest of the reparations would be obtained from East Germany in the future. But German payments to Israel have stretched far beyond the reparations to victims of Nazi crimes. According to American political scientist Norman Finkelstein, to date Germany has paid Israel a total amount of 60 to 80 billion dollars.
Several parties saw that a relation could be established between the compensation to Palestinians and the huge capital of indemnification Israel obtained from Germany. The Arab countries approached the Four Powers before the agreements were made between the Germany and Israel had been made, asking that the Palestinians should benefit from future reparations by Germany to Israel. The Israelis were divided on the issue, as was the American government.
In the end, the Palestinians did not profit from the German reparation payments to Israel. Soon after the agreement with Germany had been reached, Israel adopted the attitude that it was under no political obligation to help Palestinian refugees and was not responsible for their losses. It was therefore only prepared to offer humanitarian help. This offer was never realized.