Palestine – Twelve Billion Reasons To Change Direction


By: David Singer

International donors have now started to renege on US$12 billion dollars in pledges made by them in Paris in December 2007 and at Sharm El Sheikh in March this year. Their decision threatens to send the Palestinian Authority into financial meltdown and political oblivion.

The following circumstances have contributed to this situation:

1. The Palestinian Authority continues to reject any form of rapprochement with Hamas leaving the Arab civilian populations of the West Bank and Gaza under separate Arab administrations and political control.

2. Negotiations between the Palestinian Authority and Israel have failed to procure the creation of a new Arab State between Jordan and Israel with little chance of those negotiations being reconvened. Offers made by Israel to bring this solution to fruition have been rebuffed by the Palestinian Authority which continues to maintain the same unchanged demands made by the Arab League for the last 42 years.

3. The global financial crisis has caused international donors to reconsider whether their dollars should now be directed to more worthy international projects that have a reasonable prospect of eventuating rather than run the risk of ending up in a bottomless pit pursuing a solution that so far has failed to get to first base despite the most intense international diplomacy ever seen to try and make it happen.

Donor resistance to meeting pledges publicly surfaced when the Chairman of the Ad Hoc Liaison Committee On Assistance For The Palestinians [AHLC]- Norway’s Foreign Minister Jonas Store – made an impassioned plea to donors attending last week’s meeting of the AHLC in Oslo on 8 and 9 June to not default in meeting their commitments.

The AHLC was established in 1993 following the signing of the Oslo Accords. Donor members have since then poured tens of billions of dollars into the West Bank and Gaza with very few benefits that can be readily ascertained. Much of the money has reportedly ended up in Swiss bank accounts instead of being used for the benefit of West Bank and Gaza’s Arab populations.

Donors attending the Oslo meeting last week had good reason for putting away their chequebooks when Mr Store told them:

“The mission of the AHLC can only be effective if it works in concert with a dedicated effort to forward the political process. And consequently – when the political process stalls, the majority of donors lack the necessary motivation to maintain their contributions.

Certainly tipping more money into the pool in the face of the current stalled political process appears be a most imprudent and reckless investment.

Mr Store further confirmed that “an increasing number of donors are not living up to their pledges,” that the “Palestinian Authority is heading towards fundamental financial crisis” and “is hanging on by a thread.”

Mr Store urged donors to meet their pledges to prevent the demise of the Palestinan Authority saying :

“The international donor community’s support to the Palestinian Territory is in essence political, not humanitarian. Our aim is to help facilitate the creation of a two-state solution where Israeli occupation is replaced by a free and sovereign Palestinian State, living side by side with Israel in peace and security. Without this clearly defined political horizon, donor commitment at the current level can hardly be sustained. Again I believe that continued lack of a political horizon can help explain why a growing number of donors are becoming lukewarm”

The AHLC’s defined political horizon has clearly failed to eventuate.

Many donors might well regard their donations as being humanitarian in nature to provide financial relief and assistance to the civilian population rather than political. Many could take the view that their donations should not now be used to prop up the Palestinian Authority in its struggle with Hamas for control of the West Bank and Gaza streets. Mr Store’s remarks could well have offended many donors and given them additional reason to stop meeting their pledges.

Mr Store told the donors:

“Sooner rather than later, the West Bank and Gaza must be reunified as indivisible parts of one territory, under one Authority … Because absent a modicum of Palestinian political and territorial unity, it will be exceedingly difficult to negotiate, let alone implement, a final-status agreement that stands a chance of ending the conflict between Israel and the Palestinians.”

In doing so Mr Store effectively exposed the weakness of President Obama’s efforts in Cairo the previous week urging Israel and the Palestinian Authority to sit down and resume negotiations. The chances of getting an agreed agenda mutually acceptable to both parties is not going to happen.

Until the Palestinian Authority and Hamas resolve their differences and come up with a unified platform that recognizes the Jewish State of Israel, the prospects of getting Israel to positively respond to President Obama’s plea will prove to be a total waste of time and effort.

The AHLC needs to urgently review its two state political horizon because the reality of that ever occurring is now further away than ever. It cannot expect donors to maintain their financial commitments in the face of the total chaos and conflict that the divisions between Hamas and the Palestinian Authority presently pose.

Perhaps Mr Store should be quietly whispering to Jordan whether it could make good use of the $12 billion dollars by replacing the Palestinian Authority and entering into negotiations with Israel to allocate sovereignty in the West Bank between Jordan and Israel.

Such a political horizon could result not only in the international donors being ready to meet their existing obligations but could well trigger an even greater financial response in the recognition that this way forward represents the most realistically attainable political solution which benefits not only Jews and Arabs but the donor countries themselves.

If the non-payment of pledges leads to the demise of the Palestinian Authority and the return of Jordan to the West Bank after previously having occupied it between 1948-1967 then perhaps such non-payments will signal the most effective international response available in helping to end the conflict between Jews and Arabs.

In a region where honouring obligations is rare the international donors would certainly be justified in deciding to end their relationship with the Palestinian Authority which has singularly failed to achieve the objective for which it was created in the euphoria of the signing of the Oslo Accords in 1993.

Biting the hand that feeds you ultimately has its consequences – as the Palestinian Authority is now starting to see.

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