The Board of Governors determines that:

1.(a)The framework of the budget for operating activities of the Jewish Agency for Israel for the Fiscal Year January 1, 2005 through December 31, 2005 as presented in the proposed budget attached hereto is in the aggregate amount of $ 290,000,000  for unrestricted activities, $ 78,400,000  for the JAFI  validated unfunded needs and $ 50,000,000 for facilitated activities.
The budget framework for JAFI designated projects, as well as the budget for facilitated projects, will be adjusted according to actual funding commitments and actual revenue.

(b) In the framework of the above budget is included a line for "foreseen Cost Increase"  in the amount of  $ 7,782,000.

In this section "Cost Increase" means - differences between the costs of programs or sub-programs as approved in this budget and the costs of the same programs or sub-programs at the time of their actual implementation.

(c) The Director General is authorized to approve payments due to employees' retirements, above the amounts budgeted in Fiscal Years 2004 and 2005. The Director-General shall exercise this authority subject to the provisions of Article VI.A.2.(c) of the By-Laws.

2. The framework of the budget for development and financing activities of the Jewish Agency for Israel for the Fiscal Year, as presented in the proposed budget attached hereto is in the aggregate amount of $ 12,100,000 for unrestricted development activities, $ 23,930,000 for designated development activities, and $ 1,000,000 for unrestricted financing activities.

3(a) The framework of the unrestricted budget for operating activities of the Jewish Agency for Israel for the first quarter of the Fiscal Year beginning on January 1, 2005 and ending on March 31, 2005 as presented in the proposed budget attached hereto is the amount of $ 72, 506, 000.

(b) The Jewish Agency shall not make commitments for programs beyond March 31, 2005.

(c) Despite the provisions of subsection (b) if, until the approval of the final budget, the need arises to take budgetary commitments for programs beyond March 31, 2005, such commitments may be made only with the approval of the Director General of the Jewish Agency and the Director General of the Finance Department.

(d) In February 2005, the Executive will submit a final budget for the approval of the Board of Governors.

4. The Jewish Agency for Israel may, during the Fiscal Year, renew existing Financial Commitments which shall mature during the Fiscal Year and borrow additional sums as interim financing together with the amounts for capital investments made in the Fiscal Year and payments for employees' retirements, so that at the end of the Fiscal Year the accumulated deficit may exceed the total accumulated deficit at the beginning of the year.

"Financial Commitments" shall mean any loan, guarantee, indemnity or any other financial transaction and any document evidencing or constituting such financial commitment.