State-building measures will achieve nothing while Palestine is a colony

December 18, 2013
Sarah Benton


Ending occupation—the best and only confidence-building measure

Settlement Report
By Geoffrey Aronson,Foundation for Middle East Peace (FMEP)|
Vol. 23 No. 6m November-December 2013

In a series of reports during the last decade, international institutions led by the World Bank and International Monetary Fund (IMF) have highlighted the vital contribution of strong institutions to state building in the Palestinian territories.

This interest and extraordinary support offered to the Palestinian Authority (PA) has a broader political context. In the era when the international community, led by the United States, was content with Yasser Arafat’s leadership and focused on implementation of the “further redeployments” called for in the Oslo II agreement, international concern was all but absent for the coherence, transparency, and governance of Palestinian institutions created as a consequence of agreement between Israel and the Palestine Liberation Organization (PLO).

The change in this policy was initially the product of a political decision by the administration of President George W. Bush to “empower” Mahmoud Abbas in the newly created position of PA prime minister at the expense of PA chairman Arafat, who had run afoul of the United States and Israel in the wake of the failed talks at Camp David in mid-2002 and the subsequent second intifada.

In what has become known as the “vision speech,” Bush, two months after Israel’s Operation Defensive Shield had resulted in the reoccupation of Area A by the Israeli military in April 2002, declared, “And when the Palestinian people have new leaders, new institutions and new security arrangements with their neighbors, the United States of America will support the creation of a Palestinian state whose borders and certain aspects of its sovereignty will be provisional until resolved as part of a final settlement in the Middle East.”

Under the leadership of Abbas, as Arafat’s successor as head of the PA and PLO chairman, and with critical support and credibility lent by former IMF official Salaam Fayyad as prime minister, the PA set about implementing the reform agenda demanded by the international community.

Salam Fayyad (right), with Quartet representative Tony Blair in 2009. Photo by Mustafa Abu Dayeh / APA images

“Palestine—Ending the Occupation, Establishing the State,” a two-year plan for setting up the administrative infrastructure of a Palestinian state, was unveiled by Fayyad in August 2009. In April 2011, the IMF reported that that the Palestinian Authority “is now able to conduct the sound economic policies expected of a future well-functioning Palestinian state, given its solid track record in reforms and institution-building in the public finance and financial areas.”

Strong, transparent, and well-run institutions are certainly desirable, but such institutions and practices, while vital to effective policy making and execution, have never been a prerequisite for sovereignty or statehood.

Sovereign and autonomous control of territory remain the time-tested sine qua nons for national liberation, and it is precisely at this critical point—the ability to control their own territory—where Palestinians are at a woeful and deliberate disadvantage.

More than three decades ago, long before the Oslo era, Israeli planners and politicians mapped out a territorial division of the West Bank, including East Jerusalem, that reflected two related Israeli objectives: to establish the administrative and political basis for Israel’s widespread colonization of the West Bank, and in so doing, deny Palestinians the territorial base upon which they could build a truly sovereign national existence. At the time, Prime Minister Menachem Begin described this zero-sum objective as “autonomy for the people, not the land.”

By 1981, in its thirteen-year survey of the occupation, Israel’s Ministry of Defense was able to speak positively of the “disappearance of the Green Line, de facto if not de jure,” as good for both “the areas’ inhabitants,” that is, Palestinians as well as Israelis.

Nothing that has transpired in subsequent decades—including more than twenty years of negotiations after the signing of the Oslo II agreement and the appearance of permanent, widespread restrictions on movement, most notably the separation barrier—has modified this Israeli objective. Indeed, the principal diplomatic event of the last generation is the Oslo II accord and its division of the West Bank into Areas A, B, and C, with a separate status under Israeli control for East Jerusalem. This agreement marked the PLO’s recognition of a territorial division of the West Bank that placed 60 per cent of it outside any Palestinian jurisdiction. For the PLO, the Oslo process and the map it created were viewed as a temporary way-station on the road to ending the occupation, evacuating settlements, and independence—assumptions that remain unrealized after more than two decades.

Exhausted Palestinian men, having  crossed from the West Bank via Qalqilya before dawn, wait for the Palestinian-only bus to take them for a day’s work in Israel. Can an independent economy be built from this? Photo by Uriel Sinai/Getty Images

In recent years, the international community has reached important and related conclusions about the value of its focus on the reform of Palestinian administrative and economic institutions. First, it recognizes that well-run institutions are not enough. Indeed, reformed governing institutions have proven all but irrelevant to Palestine’s battle for sovereignty, failing to impress Israel to the degree that it is prepared to abort its colonization agenda or emboldening the international community to insist on an end to the occupation.

It is the occupation, rather than shortcomings in PA governance, that suffocates the economic prospects of Palestine, imposing unbridgeable structural limitations on the model of economic development pursued under international guidance during the last two decades. The World Bank, in its 2011 report, “Sustaining Achievements in Palestinian Institution-Building and Economic Growth,” acknowledged that “[Palestinian economic] growth has been unsustainable, driven primarily by donor aid rather than a rebounding private sector, which remains stifled by Israeli restrictions on access to natural resources and markets.”

Notwithstanding the failure of its past efforts, the international community, led by the Barack Obama administration, continues to pursue a development strategy that assumes the creation of a sustainable foundation for Palestinian economic growth under conditions of continuing occupation. But the international community has now begun to see more clearly that in order to succeed, Israel’s powers have to be reduced, and the territorial basis of Palestinian access and control expanded beyond the 40 percent of the West Bank included in Areas A and B. As the World Bank noted in its September 18, 2011, economic report to the Ad Hoc Liaison Committee, “[U]ltimately, in order for the Palestinian Authority to sustain the reform momentum and its achievements in institution-building, remaining Israeli restrictions must be lifted.” The bank’s 2013 report to the Ad Hoc Liaison Committee makes this point in even stronger terms, detailing the broad and comprehensive impact of Israel’s continuing exercise of control over the occupied territories:

The most significant impediment to economic viability in the Palestinian Territories is the multi-layered system of restrictions imposed by the GoI [government of Israel]. The system of restrictions constrains investment, raises costs for doing business, and hinders economic cohesion. Restrictions on access and movement also negatively affect the PA’s capacity to deliver public services. While some actions have recently been taken by the GoI to relax certain restrictions, stronger measures to significantly ease pervasive remaining obstacles that currently prevent private sector–led economic growth are warranted.

This analysis makes an important contribution to understanding the costs of occupation and the critical role that the absence of sovereign Palestinian control over territory plays in the march to statehood and independence.

But these recommendations are weakened by a major conceptual flaw. The system of occupation, with the Palestinians’ loss of control over land that is at its core, has not evolved naturally or unintentionally. And the consequent inability of Palestinians to behave in a sovereign and viable national manner is not viewed by Israel, which designed this arrangement, as a shortcoming in need of revision, but the intentionally designed, critical feature of a system that functions exactly as intended, safeguarding Israel’s expansive settlement and security agenda, and in so doing, preempting the creation of a national, sovereign Palestinian existence.

So for example, the creation of Area C under Israel’s exclusive control, comprising 60 percent of the West Bank, is not the consequence of some bureaucratic whim or oversight, but instead reflects a considered Israeli intention to settle and place beyond Palestinian reach the basic territorial assets vital to the ability to build an independent national existence. 
[our emphasis]

The creation of Area C—beginning with Ariel Sharon and World Zionist Organization planners in the late 1970s and formalized in the Oslo II accord in September 1995—was devised precisely to preempt the creation of effective Palestinian demand for real sovereignty and independence. This is why Israel remains adamant in its protection of its settlement, development, and security vision in this area despite Palestinian objections and the plaintive efforts of the international community.

The international effort to support Palestinian development within the territorial stranglehold established by the division of the West Bank into Areas A, B, and C and to accommodate the draconian restrictions imposed on the Gaza Strip has been on the whole welcomed by Israel as key elements in what some call a “deluxe occupation.” It should come as no surprise that Israel’s leadership, regardless of political hue, has no interest in supporting Palestinian economic growth that could reinforce effective demands for political and territorial sovereignty in the areas captured by Israel in June 1967.

The essential conclusion that occupation precludes Palestinian economic development and undermines good governance is beyond the limited mandate of the World Bank and similar international donors, including the effort spearheaded by former British prime minister Tony Blair. It is nonetheless essential in order to mobilize international efforts to challenge the current territorial arrangement designed by Israel to prevent the very aim that the international community professes to support—independence, economic security, and sovereignty for Palestinians.

Lost Palestinian economic output due to Israeli control of Area C

November-December 2013

Amona outpost, illegally built on privately-owned Palestinian land near Ofra in the West Bank. Still standing despite many demolition orders. Photo by Baz Ratner/Reuters

FMEP November-December 2013

In 1997, the first demolition order was issued against the West Bank settlement outpost of Amona. In 2003, another demolition order was issued. In 2006, the state deigned to raze a mere nine buildings. In 2008, the state admitted that construction on the site was illegal and announced that the entire outpost would be razed. In 2011, the state announced that the outpost would be evacuated by the end of 2012. By the end of 2012, nothing had happened.

Now, in mid-October 2013, 16 years after the first demolition order was issued, the state is asking the court for a postponement—yet again. Here’s the explanation this time: “In the government’s view, an evacuation on such a scale at a time like this is liable to harm Israel’s diplomatic interests. . . . When there are weighty considerations on one hand, and no concrete petitioner on the other . . . the diplomatic considerations take precedence.” . . .

Amona is not just an outpost built through deception on privately owned Palestinian land; it is a symbol of a state that mortgages the future of its citizens to a messianic, anti-Zionist dream dictated by an aggressive, violent gang that has taken over the political and institutional centers of power.

The fact that even the prosecution is collaborating with these lawbreakers, and that Attorney General Yehuda Weinstein is backing this illegal takeover of private land, ought to worry every Israeli who desires to live in a sane country.

“The Amona Complex,” Ha’aretz, October 16, 2013

In recent years, some international parties have tried to convince the world that solutions begin by removing a roadblock or allowing ketchup and mayonnaise into Gaza. The Israeli government argues that giving Palestinians some work permits and allowing a few trucks into Gaza are “confidence building measures.” But what Palestine needs is ending the Israeli occupation, which is the only way for Palestine to reach its full economic potential. No “confidence building measures” will end the theft of Palestinian resources nor the catastrophic social consequences of the Israeli occupation policies.

PLO negotiator Muhammed Shtayyeh, “The Real Cost of the Occupation,” Ha’aretz, October 22, 2013

The donor community in recent months has highlighted the costs to Palestine of Israel’s continued control of the natural resources in Area C, comprising 60 percent of the West Bank.

“In sum, the total potential value added (direct and indirect as a result of the alleviation of today’s restrictions on access to, and activity and production in Area C) is likely to amount to about USD 3.4 billion—or 35 percent of Palestinian GDP in 2011.”

World Bank, “West Bank and Gaza: Area C and the Future of the Palestinian Economy,” October 2, 2013
Notes and links

Foundation for Middle East Peace (FMEP)


Established in 1979 by the late Merle Thorpe, Jr., the Foundation is dedicated to promoting, through various activities, a just solution to the Israeli-Palestinian conflict that brings peace and security to both peoples.

Because of the importance of Israeli settlements as a factor in the Israeli-Palestinian conflict, the Foundation has published since 1992 the bimonthly Report on Israeli Settlements in the Occupied Territories, edited by Geoffrey Aronson. The Report contains detailed, authoritative analysis, data and maps on settlements and their relationship to the peace process. Current and previous editions of the Report are available on this website (see FMEP Reports). You can also subscribe to receive the Report via e-mail, or write us for a paper copy.

Other issues relating to peace and security in the Middle East are addressed in periodic special editions of the Report.

The Foundation has also published or supported publications of books, including the following:

Prescription for Conflict: Israel’s West Bank Settlement Policy, by Merle Thorpe, Jr. (1984). (A few copies of Prescription for Conflict are still available. Although this seminal book on settlements was published in 1984, it contains analysis, photographs and documents that are still timely. Write us for a free copy.)
Error and Betrayal in Lebanon, by George W. Ball (1984)
Facing the PLO Question, by Philip Klutznick, former president of B’nai B’rith International and the World Jewish Congress, Meir Merhav of the Jerusalem Post, and Hermann Eilts, former U.S. ambassador to Egypt (1985)
A Policy for the Moment of Truth, by Major General (Ret.) Yehoshafat Harkabi (1988)
No Trumpets, No Drums, by Mark Heller and Sari Nusseibeh (New York: Hill and Wang, 1991), a Foundation-supported book analyzing the “two-state solution” to the conflict
The Israeli-Syrian Peace Talks: 1991-1996 and Beyond, by Helena Cobban, U. S. Institute for Peace, 2000.

The Foundation is a non-profit charitable and educational organization qualified under Section 501(c)(3) of the Internal Revenue Code, March 1994.

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