CAIRO MEETING ADDRESSES ECONOMIC, HUMANITARIAN CRISIS IN PALESTINIAN TERRITORY

 

Speakers Stress Need for Short-, Long-Term Solutions

(Received from a UN Information Officer.)

CAIRO, 26 April -- In his keynote address to the United Nations Seminar of Assistance to the Palestinian People this afternoon, Member of Palestinian Legislative Council Nabil Sha’ath said the new Government was willing to accept financial oversights or to have money transferred through President Abbas, but it could not accept the attempt to bypass the Palestinian Authority.

Stating that long-term solutions to the situation in the Occupied Territory had to be considered, he called for the serious reconvening of the conference of High Contracting Parties to the Fourth Geneva Convention to protect Palestinians; an increased United Nations presence; implementation of donor pledges; the return of a free transfer of funds to the Palestinians; and the revitalization of the Rafah agreement on the freedom of movement.

This afternoon’s session, part of a two-day meeting sponsored by the Committee on the Exercise of the Inalienable Rights of the Palestinian People, heard presentations by experts on the scope of the economic and humanitarian crisis in the Occupied Palestinian Territory.

Following the keynote address, Director of the Israel-Palestine Centre for Research and Information in East Jerusalem Gershon Baskin said Israel and the Palestinians did not have the tools or ability to resolve the conflict by themselves. 

He recommended an internationalization of the solution, proposing that Israel withdraw behind the security barrier, including all settlements east of the barrier, and that it request a United Nations interim administration mission take responsibility for those areas and prepare the Palestinian Territory for independence.

The private sector might be able to help in the current situation in the Occupied Territory, Hanna Siniora, Chairman of the Palestinian-European Chamber of Commerce, said.  He suggested giving responsibility for the housing business and other areas to the private sector in order to create jobs and form a larger base of people able to pay taxes.

Birzeit University Professor Hani Nigim said the Palestinians were looking for intensified assistance in the short term.  They needed urgent services and assistance.  Free movement of that assistance was essential.

The Palestinian people had to prepare future infrastructures to cope with coming demographic challenges, including a viable solution to the needs of refugees, the Chairman of the Israeli Institute for Economic and Social Research, Roby Nathanson, told the Seminar.  The existing infrastructures in the West Bank could provide a solution to the reconstruction of the Palestinian economy.  He stressed the importance of turning them over to the Palestinians intact.

Senior Gaza Economist Mohammed El-Samhouri said that Western donors, in the effort to bypass the Hamas–led Government, were considering United Nations agencies and international non-governmental organizations as alternative channels for aid delivery.  Bypassing the Government, however, would undermine the Palestinian public institutions that the donors had helped to create.  He went on to say it would be difficult to ignore the Government since all aspects of the aid cycle had to go through official bureaucracy.  Moreover, United Nations agencies and foreign non-governmental organizations did not have the capacity to provide services in areas traditionally covered by the Government.

Tomorrow, in Plenary II, experts will explore the United Nations and international donor community’s support of the Palestinian people.

Keynote Address

NABIL SHA’ATH, Member of the Palestinian Legislative Council, said the issues Palestinians now faced were both chronic and acute and required different solutions.  The Israeli attempt at serious demographic change had been going on since the beginning of the peace process.  The building of the separation wall which would enclose huge areas of Jerusalem, separating people from their jobs, schools and hospitals, continued, and Israel now said openly that it was imposing a unilateral solution.  The wall had attracted support on the basis that it was better than nothing, but the experience of Israel’s unilateral solution in Gaza was a bitter one.  Gaza now was under total siege and cut off from the world and the rest of the Palestinian Territory.  Unilateralism was not the way to reach a peaceful solution.

Added to the chronic problems were the increasing denial of the entry of products, an action that could precipitate starvation, he said.  Interrupting the transfer of funds was not new.  The Palestinian budget was, in part, financed by taxes collected by the Israelis.  With the stoppage of international aid and tax revenues, there was not enough money.  Because of a total freeze, all of Gaza’s produce meant for export had to be destroyed.  The sanctions were a form of collective punishment that impeded the peace process.  There were few examples of international sanctions leading to a successful outcome.  Moreover, what sanctions had ever been imposed on Israel when it violated international agreements?  He was stunned by the international response.

Long-term solutions had to be considered, he continued.  A move to end the Israeli occupation had to go hand in hand with humanitarian aid and serious international commitment to a solution.  He supported the reconvening of the conference of the High Contracting Parties to the Fourth Geneva Convention to protect Palestinians.  Additionally, Palestinians might have to call for an increased United Nations presence.  All donors had to be persuaded to resume the implementation of their pledges.  The return of a free transfer of funds to the Palestinians was imperative.  The attempt to interfere with the banking system to prevent people from receiving money, even from Palestinians and other Arabs, was unacceptable.  The Rafah agreement on freedom of movement must be revitalized.  The present Government was willing to accept financial oversights or to have the money transferred through President Abbas.  It could not, however, accept the attempt to bypass the Palestinian Authority.

Plenary I -- The scope of the economic and humanitarian crisis in the Occupied Palestinian Territory:  Main characteristics of the crisis and living conditions of the Palestinian People; facts on the ground compounding the crisis; modalities for rehabilitating and stabilizing the Palestinian economy

Statements

HANNA SINIORA, Chairman of the Palestinian-European Chamber of Commerce, Publisher, Jerusalem Times, said that the private sector might be able to help in the current situation in the Occupied Territory.  He recommended giving responsibility for housing construction to the private sector.  With more responsibility in that field, the private sector could create 300,000 new jobs.  The road system was deteriorating and the private sector could help in that and other areas, as well.  There was an economic need for a link between the Gaza Strip and the West Bank.  Israel had decided on a 40-kilometre sunken highway between the two areas.

Describing some aspects of the situation in the Occupied Territory, he said that Palestinians were not allowed to import or export through Rafah.   Israel had frozen about $55 million-$60 million of crucial funds.  The United States imposition of sanctions was no surprise.  What was strange was the position of the Europeans and others who complied with the sanctions that would bankrupt what remained of the private sector.  Almost 40 per cent of the Palestinian stock exchange had been wiped out.  If the European Community did not rescind their decision to stop aid to the Palestinian Authority, the Authority would be completely bankrupt and unable to meet the needs of its people.  The sanctions not only affected the Palestinian people, but would hinder the move forward to the peace process.

He supported the idea of a united Palestinian front in which the private sector would have a role.  Although there was little coordination between the Presidency and the Cabinet of the Palestinian Authority, Fatah and Hamas did not differ on economic issues, he said.  There were political disagreements, but both sides were working to end the occupation.  The difference was that the Palestine Liberation Organization (PLO) had concluded agreements with Israel and had gotten nothing in return.  Hamas was suggesting a new approach with Israel making some concessions.  Hamas was ready to accept the State of Israel when it ended the occupation and returned to 1967 borders.  Pressure had to be exerted on both Israel and Hamas to accept the Arab peace plan.

GERSHON BASKIN, Director, Israel-Palestine Centre for Research and Information in East Jerusalem, said that Israel and the Palestinians did not have the tools or ability to resolve the conflict by themselves.  Stating that internationalization of the solution was perhaps the best way to ensure a two-State solution, he suggested that consideration be given to the Arab peace plan, as well as to a United Nations interim administration mission.  Elaborating on the mission, he said that Israel should withdraw behind the security barrier, including all settlements east of the barrier, and request that a United Nations interim administration mission take responsibility for those areas and prepare the Palestinian Territories for independence.  The mission would include a military arm and maintain a strong presence along the Jordan River, as well as man all the crossing points into Israel from the Palestinian side.  It would also have policing function and work directly with Palestinian security forces under a single command.  With a financial governance component, the mission would undertake several major infrastructure projects and be the recipient and administrator of international aid benefiting the Palestinian people.  Future control of the political process would be in the hands of the Security Council.

Continuing, he said that such a plan would enable Israel to conduct a secure and safe withdrawal.  Direct responsibility for the welfare of the Palestinians would be transferred to the international community.  Hamas would also transfer financial management and governance of the Territories to the international community.  With the advent of major economic development and infrastructure projects, Palestinians would be less dependent on Israel.  Israeli borders in the West Bank would be secured by international troops.  A disadvantage for Israel would be that it would be limited in what it could do inside the Territories controlled by international forces.  It would also lose control over the eastern border with Jordan.

The advantages for the Palestinians, he said, included internationalization of the solution and removal of Israel from most of the Occupied Territory with the possibility of returning to internationally assisted negotiations on final status issues.  Disadvantages included a less independent Palestinian Authority that would have to work in accordance with an international administration.

HANI NIGIM, Professor, Birzeit University, said the rising unemployment was fuelled by the closure of the Green line to Palestinian workers, the scarcity of raw material which resulted in the stoppage of work on many projects, and the halting of projects which had been supported by donor countries.  Unemployment was also affected by the decreasing number of people working in the private sector and the increasing difficulties being faced by the banking community.

He said the economic situation was extremely difficult.  It caused the Palestinian head of the family wonder what was happening to the peace process.  The economic difficulties influenced the increase in violence.  At the same time, the violence had repercussions on the economy and ultimately on individual Palestinian men and women, as well as on the private sector.  Some Israeli banks had ceased their dealings with Palestinian banks leading to a drop in the exchange rates.  Banks were also seriously affected by the difficulties involved in transferring money to relatives in the Palestinian Territory.

The donor community had stopped dealing with the local governments, he said.  Several countries had stopped investing and many Palestinian exports had been stopped.  Those events had increased the suffering of the Palestinian people.  The Palestinians were looking for intensified assistance in the short term.  They needed urgent services and assistance and support for the free movement of assistance.

ROBY NATHANSON, Chairman, Israeli Institute for Economic and Social Research, Tel Aviv, said that at the end of the day, both people were suffering and they must find a way to address a solution.  Presenting several options, including the Oslo Agreements, the Geneva Accord and the Road Map, he said unilateral withdrawal was an option that might happen in the near future and was essential to the reconstruction of the Palestinian economy.  The Palestinian people had to prepare future infrastructures to cope with demographic challenges, including a viable solution to the needs of refugees.

He said existing infrastructures in the West Bank could provide a solution to the reconstruction of the Palestinian economy.  He did not recommend the model of Gaza in which the existing infrastructure was destroyed rather than used for the benefit of the future Palestinian State.  He stressed that the population would increase from 4.02 million in 2005 to 5.5 million in 2015.  In 2005, Palestinians would need 468,000 housing units in the West Bank with a shortage of 164,000 units.  Additionally, 414,000 people living in camps in the Territory would need to be resettled.  They would also need access to other infrastructures such as schools, hospitals and communal services.

Describing the background of settlement activity, he said that, while it had begun in 1967, 56 per cent were built between 1977 and 1983, and the bulk of them were residential.  Settlement construction had never stopped.  With the use of aerial photos, his organization had developed information about every settlement, what they contained and their respective value.  The Israeli Government supplemented those settlements by more than 40 per cent with a total investment of $14 billion.  Presenting charts detailing the types of buildings and their uses in settlements that would be evacuated; he stressed the importance of turning them over to the Palestinians intact.  It required a willingness to cooperate, but it would help to alleviate the Palestinian crisis.

MOHAMMED EL-SAMHOURI, Senior Economist, Gaza, said that in response to the potential humanitarian and economic Palestinian crisis, Western donors, in the effort to bypass the Hamas–led Government, were considering United Nations agencies and international non-governmental organizations as alternative channels for aid delivery.  For a variety of reasons, however, bypassing the Palestinian Government might prove costly and problematic.  That approach would undermine the Palestinian public institutions that the donors had helped to create since 1994.  All aspects of the aid cycle had to go through official bureaucracy making it difficult to ignore the government.  Further, in crisis circumstances, Governments usually saw as their first job helping the population cope with the situation.  Finally, United Nations agencies and foreign non-governmental organizations did not have the capacity to provide services in areas traditionally covered by the Government.

He called attention to the World Bank report last month which stated that preserving the status quo where international aid, customs revenues transfers and restrictions on Palestinian movement maintained their 2005 levels, would not prevent Palestinian economic conditions from deteriorating.  At its core, the Palestinian financial predicament was the product of a suffocating economic crisis rooted in a deeply unfavourable political environment.  International aid could only help Palestinians to survive but would have no tangible effect on the economy. 

For international aid to make a lasting difference, he said, there was a need to address whether current political and territorial realities allowed external aid to be used to enable Palestinians to transfer the economy from one totally dependent on foreign assistance to one capable of generating sustained growth rates.  Only a fair negotiated political system that fundamentally reformed the Palestinian conditions would resolve the economic calamity.

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For information media • not an official record