The Paris Protocol: why Palestinian protesters want to ditch it

This posting has 4 items:
1) Daily Times Palestinians seek to amend economic accord with Israel;
2) Abir Kopty, The National West Bank protests expose Oslo as the prop of occupation;
3) Khaled Abu Toameh, JPost Ayalon: Israel will reject PA economic accord review ;
4) B’Tselem  The Paris Protocol, freedom of movement CST; Plus link to the text of the protocol

Palestinians seek to amend economic accord with Israel

* Paris deal maps out Israeli-Palestinian economic blueprint
* Palestinian economy also suffering from aid drought

By Daily Times, Pakistan
September 10, 2012

RAMALLAH–The cash-strapped Palestinian Authority said on Sunday it has asked Israel to consider overhauling a key economic agreement that has determined its customs and tax rates for the past 18 years, in the wake of street protests against high prices.

UN agencies and Palestinian economists say the economic sections of the Oslo interim peace deals, outlined in the Paris Protocol of 1994, have been implemented by Israel selectively and mostly to its benefit. “Eighteen years of the Paris economic agreement have become a heavy burden on the Palestinian people and led to very difficult financial and economic conditions,” Palestinian Civil Affairs Minister Hussein al-Sheikh told Reuters. The aid-dependent Palestinian Authority (PA), which exercises limited self-rule in the occupied West Bank, has also been plunged into its deepening financial crisis by a drop in assistance from Western and wealthy Gulf backers.

The Paris Protocol maps out an economic blueprint for a customs union between Israel and the Palestinian territories and pegs value added tax to Israeli rates, now at 17 percent, effectively blocking any steep price cuts in the West Bank. In another blow to the Palestinian economy, provisions allowing the Palestinians to make free trade agreements with other states and mandating access to Israeli markets have not transpired. Last week, days of street protests in the occupied West Bank against high living costs led Palestinian Prime Minister Salam Fayyad to say on Thursday he would be willing to resign if there was “a real public demand” that he step down.

Sheikh said he had sent a letter, at President Mahmoud Abbas’s request, to Israel’s Defence Ministry “demanding they open” the Paris accord and offering to form joint technical committees to negotiate its amendment. Asked about the Palestinian move, Amos Gilboa, a senior Israeli Defence Ministry official, told Israel Radio: “We have to examine exactly what they are proposing and to see if it’s practical.” The Palestinian government is grappling with a recurring budget deficit and external debt, both hovering above a billion dollars or nearly a fifth of gross domestic product.

Foreign aid is now lagging, as a hoped-for $1.1 billion in 2011 reached only $750 million, as pledges from Gulf states in particular fell short. Some economists say economic growth could be as low as 3-4 percent this year, and with a fifth of the population unemployed, prospects for many of the West Bank’s 2.5 million Palestinians are declining. The Palestinian Authority’s cash crisis has delayed salary payments for some 153,000 civil servants several times this year. Perhaps worried the stalling economy will unleash unrest in the territories, Israel is showing flexibility.

After a year of negotiation, Israel agreed this summer to streamline the handling of import duties it collects on goods bound for the Palestinian market – duties worth some $100 million a month, around two-thirds of PA income. But Samir Abdullah, director general of the Palestine Economic Policy Research Institute, said the Paris accord need to be renegotiated to free Palestinians from their dependence on Israeli oversight and allow them more leeway to trade abroad. “Israel has not committed to open its market to the Palestinians while the Palestinian market has remained open to it,” he told Reuters.

West Bank protests expose Oslo as the prop of occupation
By Abir Kopty
Sep 12, 2012

Nineteen years after the Oslo Accords were officially signed on September 13, 1993, it is clearer than ever that the Accords have blocked Palestinian rights of freedom, return and self-determination. The current protests shed light on this disastrous burden for Palestinians.

Protests are spreading rapidly across cities in the West Bank, including general strikes in protest of high prices. At first, protests were orchestrated by Fatah and directed against Salam Fayyad, the Palestinian prime minister, blaming him for the economic crisis and rising prices. Protests were seen as an opportunity to dispense with Mr Fayyad and divert people’s anger away from the rest of the Palestinian Authority, as well as to demonstrate to donor countries the necessity of financial aid.

But soon thereafter, more voices joined the protests to address a root problem: the Oslo Accords and their economic annex, the Paris Protocol.

President Mahmoud Abbas has demanded a review of the Paris Protocol signed with Israel in 1994. This is a tactic to calm the street, and another excuse to keep negotiating with Israel forever. It is naive to expect that Israel will accept the request, unless it has, as a coloniser, a clear interest.

It seems unlikely Mr Abbas’s declaration will defuse the protests as people have no expectations of their occupiers. If protests continue, expand in number and address the occupation and the Oslo Accords, it will be the time to put forward an alternative vision.

Oslo has had long-lasting and damaging consequences: it led to the establishment of the Palestinian Authority, with no sovereignty, in Gaza and the West Bank; created an endless process of negotiation and security coordination; solidified complete economic dependency on Israel and donor aid; and divided Palestinian people across cantons within the West Bank and Gaza, and between Palestinians living in historic Palestine and in the diaspora.

Since the Oslo Accords were signed, the PLO, the only legitimate representative of Palestinians, has lost its mandate to the Palestinian Authority. A crucial step forward would be to put the process back in the people’s hands through direct Palestinian National Council elections in which all 11 million Palestinians – Palestinians in the 1948 borders and refugees, as well those in the 1967 Occupied Territories – could vote for leadership that would develop a new strategy for resistance.

This would allow the PLO, led by the National Council, to decide on the Palestinian Authority’s role, and not vice versa. The slogan of dismantling the PA is easy, but it remains unrealistic and unachievable in the near future. What could be changed is the mandate that sets the PA’s role: the Oslo Accords.

Oslo has guaranteed a profitable occupation for Israel. Israel is excused from any responsibility for civil services in the Occupied Territories, while benefiting from Palestinian resources such as land, water, and labour. Security coordination has guaranteed that PA subcontractors “protect” Israelis from any form of Palestinian resistance. But the PA has no ability whatsoever to protect Palestinians from settler terrorist attacks, Israeli military raids or general oppression.

Furthermore, the endless process of negotiations has given Israel a free pass to continue its illegal practices with impunity, while failing to realise even a single achievement for Palestinians.

The Paris Protocol has guaranteed Israel full control of the Palestinian economy, including imports, exports, taxes and prices. The Protocol, combined with incompetent PA policy that has failed to develop local manufacturing and agriculture, has increased dependency on foreign aid.

In most cases, states that have donated to Palestinian institutions and organisations have imposed their own agendas. One method is to link aid to political pressure, such as the US Congress’s decision to cut aid to deter efforts to bring the issue of Palestinian statehood to the United Nations in September 2011.

Other aid has ignored long-term Palestinian goals to challenge Israel’s ethnic-cleansing policy. For example, aid development projects focused on Area A (18 per cent of the West Bank) surrender to Israel’s plans to dominate Area C, which is about 61 per cent of the West Bank.

Dismantling Oslo would suggest structural alternatives for the Palestinian struggle. It wouldn’t be easy, and would mean establishing a different agenda than those in Israel, the international community and much of the Arab world.

This vision must include: unity of Palestinians – whether or not they live within the 1967 Occupied Territories – under the PLO. Old leadership needs to step aside and open a path to a new spirit.

Maintaining law and order and developing a self-dependent economy in the Occupied Territories are essential. We should be inspired by the First Intifada.

Neither donor countries nor Israel will risk “starving us out”. The international community will listen when we are strong, which requires a popular resistance strategy on the ground. Resistance requires morality, efficiency and international support, mainly through the “boycott, divestment and sanctions” movement against Israel.

As for the two-state solution, a pillar of Oslo, the world will finally realise it is dead when Palestinian leaders stop holding onto it. Then the world will be forced at last to listen to the Palestinian people.

Abir Kopty is a former city council member of the Nazareth municipality, and former spokesperson for Mossawa, an advocacy centre for Palestinian citizens in Israel
On Twitter: @AbirKopty

Ayalon: Israel will reject PA economic accord review
By Khaled Abu Toameh, JPost
September 10, 2012

Deputy Foreign Minister Danny Ayalon on Monday said that Israel will reject Palestinian requests to update the 1994 Paris Protocol, the framework that established economic relations between Israel and the PA, Israel Radio reported.

Palestinians have huge debts to Israel, and yet they are operating against it in international organizations, Ayalon said.

“There is no room to fix it when there is no progress in the political channel, and the Palestinians have huge debts to Israel for transferring gas and electricity, for example,” he said.

Over the past week, PA President Abbas has come under pressure from many Palestinians to cancel the Paris Protocol under the pretext that it imposes severe restrictions on the development of the Palestinian economy.

The Paris Protocol set Israeli sea and air ports and border crossings with Jordan and Egypt as paths for Palestinian trade with other countries.

Hassan Khreisheh, an independent legislator, said that changing the Paris Protocol has become a popular demand that the PA leadership can no longer ignore.

The PA’s request came as Palestinians continued to stage protests in various parts of the West Bank against the high cost of living.

Demonstrations took place in Nablus and Ramallah Sunday, where Palestinians chanted slogans against Prime Minister Salam Fayyad and Abbas and called for their resignation.

The protesters blocked main roads in the two cities and vowed to continue demonstrating until the two PA leaders resigned.

Until now, protesters had only demanded the resignation of Fayyad.

Palestinians on Monday also held a one-day strike of public transportation in the West Bank Monday to protest against an increase in the price of fuel and basic goods.

“This is just the beginning,” said cab driver Ahmed Samara from Ramallah. “The Palestinian Authority has failed and must go.”

Hanna Amireh, a senior PLO official in the West Bank, warned that the PA could lose control if the protests continued.

Noting that the crisis was severe, he urged donor countries to quickly help the PA to prevent further deterioration.

Restriction of movement
The Paris Protocol
By B’Tselem
January 1, 2011

The Paris Protocol is the framework establishing the interim-period economic relations between Israel and the Palestinian Authority. The Protocol was signed in April 1994 and is part of Oslo 1, which was signed a few days later. The model established in the Protocol is known as a “customs union,” the primary characteristic of which is the absence of economic borders between members of the union. The practical effect of selecting this model was preservation of the economic relations that had existed until then, i.e., a Palestinian economy integrated in and dependent on the Israeli economy.

Regarding goods from other countries, the Protocol established a joint external border for the interim period. Israel collects the import taxes on the goods and transfers to the Palestinian Authority the taxes on goods that were intended for the Occupied Territories. The Protocol further provides that Israel may unilaterally establish and change the taxes imposed on imported goods. Regarding V.A.T., Israel transfers to the Palestinian Authority, in accordance with a monthly accounting, revenues collected for goods and services sold in Israel and intended for consumption in the Occupied Territories.

This kind of relationship – unlike economic separation or establishment of a free-trade area – was preferable to Israel, which did not want to establish an economic border with the Palestinian Authority, an act that would give a clear flavor of sovereignty and create a binding precedent on the eve of the final status stage. The Palestinian Authority had no choice but to accept the model set forth in the Protocol, because Israel made acceptance a condition for Israel’s continuing to allow Palestinians to work in Israel. Israel imposed the condition at a time that the Palestinian Authority was unable to provide employment within the autonomous areas to the tens of thousands of Palestinians working in Israel.

The Paris Protocol transferred to the Palestinian Authority several powers relating to economic policy, such as the authority to impose direct and indirect taxes, set industrial policy, establish a monetary authority to regulate financial mediation, and employ persons in the public sector. The Protocol also stipulated the gradual cancellation of export restrictions on agricultural produce exported from the Occupied Territories to Israel that had been in effect until then and protected Israeli farmers from competition.

The relations established in the Paris Protocol emphasized the disparity in power that had existed between the two sides from the start. The disparity was clearly evident during the first four years of implementation of the Protocol, which took place at the time (unexpected at the time of its signing) of suicide attacks and imposition of prolonged comprehensive closure of the Occupied Territories.

The customs union agreed upon gave Israel sole control over the external borders and collection of import taxes and V.A.T., thus enabling Israel to delay transfer of taxes that it collected for the Palestinian Authority, or threaten delay in transferring the monies, as a means of pressure or punishment, which indeed occurred in the summer of 1997.

According to the agreement, Palestinian trade with other countries would continue to be handled through Israeli sea and air ports, or through border crossings between the Palestinian Authority and Jordan and Egypt, which are also controlled by Israel. The necessity of obtaining Israeli approval to conduct trade leads to substantial economic loss to Palestinians whenever Israel imposes a comprehensive closure on the Occupied Territories and cancels all the relevant permits, as was often the case between 1994 and 1997.

Although the customs union framework was intended to ensure free flow of workers, the Paris Protocol did not expressly prevent Israel from prohibiting workers to enter its territory. During the first four years of the Protocol’s implementation, Israel imposed prolonged comprehensive closures on the Occupied Territories, causing a significant drop in income of Palestinians from employment in Israel and a substantial increase in poverty and unemployment.

The text of the Paris Protocol can be found here