Israel Bonds lobbying US states on foreign bonds ban

State of Israel Bonds chief Joshua Matza: Four states have changed their laws.

State of Israel Bonds (Israel Bonds) in the US is intensifying its lobbying of state legislatures to change laws banning state pension funds from buying bonds of foreign countries, State of Israel bonds president and CEO Joshua Matza told "Globes".

Louisiana has been the latest success in this campaign. Louisiana state treasurer John Kennedy announced last week that three state pension funds would buy $5 million of Israel Bonds, following a change in state law permitting state pension funds to invest up to 5% of their investment portfolios in the bonds of foreign governments. Israel Bonds were the first, and so far the only, bonds of a foreign country bought by Louisiana.

Matza said, "Many states ban investment by state entities in risky bonds, bonds of foreign countries, and bonds without an AAA rating. Israel Bonds are not AAA, but decision-makers in Louisiana and other states realized that not only are they among the best bonds in the world, but that they are also a practical expression of support for Israel."

Besides Louisiana, Israel Bonds has persuaded the legislatures of three other states to change laws, all of which have subsequently bought Israel Bonds in the past year: New Jersey ($20 million); New Mexico ($10 million); and Indiana ($5 million). "The legislative changes have not only increased the distribution of Israel Bonds, they have also expanded support for Israel among state legislatures, which are exposed to information about Israel's economic strength and the close ties between Israel and US federal government," said Matza.

Pro-Israeli sources in the US believe that the Israel Bonds initiative at the state level is one of the most effective tools available to Israel to foil initiatives by Presbyterians and other organizations to apply financial pressure against Israel, similar to the boycotts used against Apartheid-era South Africa. These sanctions were a key factor in ending Apartheid in South Africa.

Matza said 24 US states have invested hundreds of millions of dollars in Israel Bonds. He added that Israel Bonds was now trying to promote legislative amendments in three states, whose names he did not disclose. He said states liked buying Israel Bonds as a way of showing their support for Israel to their residents.

Israel Bonds' sales target in the US for the current fiscal year is $125 billion.

Published by Globes [online] - www.globes.co.il - on October 24, 2004

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