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LIKUD RUSHES TO STEM DAMAGE FROM LEVY'S DECISION TO RESIGN

The ruling Likud Party scrambled Monday to contain the damage from Foreign Minister David Levy's decision to resign, seeking to end a rift that could doom the party's chances in June's national elections.

But Prime Minister Yitzhak Shamir played down the significance of Levy's passionate resignation speech Sunday and said he doubted his foreign minister would follow through on his announcement to step down."There is no reason why this resignation should go into effect. There is no justification," Shamir said. "Whatever happens, David Levy will still be foreign minister and deputy prime minister."

Levy, 54, timed his announcement so that he would have another nine days before his resignation takes effect, 48 hours after the next Sunday Cabinet meeting.

In telling supporters about his decision Sunday night, Levy said his poor relationship with Shamir made it impossible to continue in his post and lashed out at the government's antagonistic approach to the United States. He also complained of "discrimination" within the party against the Sephardic Jews from northern Africa and the Middle East whom he represents.

Israeli commentators suggested Levy's move was a ploy to pressure Shamir into giving his supporters more influence in the coming election campaign and the government if Likud wins in June.

The daily Ha'aretz newspaper quoted sources close to Shamir as saying that Levy's resignation could harm the party's chances against the Labor Party, led by former Prime Minister Yitzhak Rabin.

"Levy is losing his mind and is bringing about the elimination of the Likud," the source told the newspaper, adding that if Likud loses the election, it will be because of the loss of Levy's support.

Party leaders said they would use the nine days before the resignation takes effect to try to convince Levy to change his mind.

But Shamir rejected Levy's criticisms and said he did not believe there were significant party rifts.

"There is nothing to extract from me. We all believe in the same things," he said. "I do not understand all this talk of discrimination. From the day I entered the movement, I never saw anthing like that."