US Secretary of State Cyrus Vance had declared in a press conference on 10 February that the Sinai settlements "should not exist." This led the government of Israel to issue a sharp statement.
The government of Israel expresses its regret and protest over the statement made by Secretary of State Vance at the press conference of February 10, 1978.
The Secretary of State declared, inter-alia:
"With respect to the Sinai settlements, we have said that we believe that all of these settlements are contrary to international law and that, therefore, they should not exist."
...The government of Israel stands by its view that the Israeli settlement program is in full harmony with international law and that it always has been legal, legitimate and essential. The United States holds a different viewpoint. However, no communication was transmitted to us, even during the seven weeks after having forwarded on December 27, 1977 the full text of the peace plan in writing to the government of the United States that the settlements "Should not exist."
Immediately after having made this part of his statement the Secretary added that, "This, however, is a problem that has to be resolved by the parties. They are going to have to negotiate it themselves."
We face here an obvious contradiction-in-terms between taking sides by a "Mediator" and his advice to conduct negotiations.
With regard to the areas of Eretz Israel, Judea and Samaria, the Secretary of State announced that "There should be a homeland for the Palestinians and that it should be linked to Jordan."
Whatever the theoretical assumptions and interpretations, there is absolutely no doubt that this plan would lead, in reality and unavoidably, to the establishment of a Palestinian state ruled by the terrorist organizations as the front-line spearhead of a potential military alignment of Jordan, Syria, Saudi Arabia and Iraq...Israel, under such conditions, would find itself nine miles from the sea and a situation would thus be created of mortal danger to its very existence. No political goal, whatever it be, can move Israel to place almost all its civilian population within the range of an enemy's fire and endanger the very existence of the Jewish state.
...The Cabinet expresses its hope that the government of the United States will reconsider its position in light of the positive talks held between the President and the Prime Minister in December 1977, in connection with the Israeli peace plan.
and a Statement by Foreign Minister Moshe Dayan on February 26, 1978:
"I do not know of a single settlement which has been established, not only since Sadat's visit, but since this Government was formed. When we submitted our peace proposal to Egypt, it was a package deal. We did not say we would evacuate Sinai under all conditions. Our approach was that of a general conception, which included demilitarization and the maintaining of Israeli settlements as a security strip along the border and which would be protected by an Israeli civilian police force. We said: Egyptian sovereignty and the maintaining of settlements under the U.N. flag and without an Israeli military force. Egypt could have and still can propose a different plan.
"The policy of this government is not to establish new settlements. No new settlements have been established. The Cabinet's most recent resolution repeated this policy of refraining from establishing new settlements while strengthening existing ones. If immigrants wish to settle in Yamit they may do so. If there is room in a settlement for 80 families and there are only 60, there is no reason not to add another 20, and if more water is required, we shall provide more water.
"It was decided at the time to establish three settlement within the framework of IDF camps in Judea and Samaria. One of these has been established, and the Cabinet decided not to annul its resolution regarding the other two, which will be established when the time comes."