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TOP SECRET DECLASSIFIED E. O. 11652, Sec. 3(E) and S(D) or (E) Dept. of State letter, By NLT- HC , NARS Date P.26.75 DEPARTMENT OF STATE WASHINGTON MEMORANDUM FOR THE PRESIDENT Subject: Representation to Israeli Government on Territorial Settlement in Palestine and Question of Palestinian Refugees. 1. Israeli Position toward Final Settlement Mr. Mark Ethridge, United States Representative on the Palestine Conciliation Commission, reports in a telegram dated May 20 (TAB A) that Israel has now put forth its full territorial demands upon the Arab States. Under authorization from the Israeli Foreign Minister, the Israeli representative at ausanne has stated as follows: (1) While Israel makes no demands upon Lebanon at present, it would later like a portion of southeastern Lebanon considered necessary to Israeli development plans. The Israeli delegate said Israel would be willing to compensate Lebanon for this territory, but he did not specify in what way this would be done; (2) Israel desires to acquire from Egypt the Egyptian occupied Gaza strip, allotted to the Arabs under the partition resolution of November 29, 1947; (3) Israel makes no demands upon Syria at present, but will accept the international frontier with the proviso, also to be applied to Lebanon, that if either state desires to open negotiations in the future for border rectification, this may be done; (4) Israel will make further demands upon Transjordan for territory in Arab Palestine considered necessary to Israeli development plans. Israel has in mind giving Abdullah a few villages in return; (5) Israel will retain occupied areas such as Western Galilee and Jaffa, Lydda, and Ramle, allotted to the Arabs under the partition plan; (6) Israel will relinquish none of the Negev. The Israeli delegate subsequently, however, indicated to Mr. Ethridge the possibility that Israel might make some compensation in the Negev in return for the Gaza strip. The Israeli delegate further stated that Israel will do nothing more concerning the Arab refugees at the present time. 2. United States Position In the interest of achieving an equitable territorial settle- ment for Palestine, this Government has consistently supported TOR SECRET