The long road from Paris to Palestine

Daniel Levy, Guardian, 18.12.07. Palestinian economic prospects will not improve under conditions of a continuing intrusive occupation even if the donor community is full of festive season generosity. A World Bank report, specially prepared for the Paris conference, put it in the following stark terms: "Even with full funding but no relaxation in the closure regime, growth [of the Palestinian economy] will be slightly negative at around minus 2% per year." Another far-reaching study released by the Crown Centre at Brandeis University and written by Dr Mohammed Samhouri, a Palestinian economist and former official, questions the assumptions behind the current donor strategy and finds them to be hopelessly out of sync with the situation on the ground and past experience. Part of the plan, therefore, is predicated on exacerbating Palestinian division. But calibrating economic reward and punishment to affect changes in political affiliation, especially of a people under occupation, is far from being an exact science. Such policies often carry unintended consequences, and in this case the irreversible damage being inflicted on the Gazan economy is not only inhumane and painfully shortsighted but is also likely to fuel a greater anger and sense of abandonment among Gazans. The World Bank study points out that economic restrictions have already led to the suspension of 95% of Gaza's industrial operations.

The donor assistance strategy should promote "a different and more realistic approach that would help foster Palestinian reconciliation, bring Gaza back into the Palestinian main political and economic fabric and stabilise the fragile conditions on the ground". The donor nations gathered in Paris are actually divided as regards to the West Bank v Gaza, Fatah v Hamas, framing of current policy. The Paris conference's co-chair, Norway, along with several EU and Arab states all favour renewed efforts at Palestinian internal reconciliation and dialogue, considering this to be the most propitious route to stability, security, economic growth and a meaningful peace process. The US, Israel and other key European states rigidly adhere to a divide and rule approach that is very likely to bring both economic and political prospects crashing down together.

For Europeans in particular the post-Annapolis reality contains a further twist of the knife. In Paris the EU and its member states confirmed their historical role as by far the largest donors to the Palestinians; in Annapolis the Europeans were effectively excluded from the political process with the creation of US rather than Quartet follow-up and monitoring mechanisms. We are back to Europe as payer not player. Europeans (and others) are being asked to place their faith and taxpayer dollars in a political process from which they are not only excluded, but not even given the face-saving semblance of having a role via the Quartet. A peace process that was designed to deliver would likely strengthen the Quartet partnership, not emaciate it.

If these flaws are not addressed, then the results of the Paris conference will become the economic accompaniment to the Palestinian state-building process recently described here in Comment is Free by Ahmad Khalidi as one that "does nothing to address basic [Palestinian] needs" and is "largely a punitive construct devised ... to constrain Palestinian aspirations". And that is a recipe for dissatisfaction all around - of course among Palestinians but also for an already fatigued donor community, and even for an Israel whose insatiable appetite for hollow victories is so clogging up its arteries that it threatens self-destruction.