Khoury (L) and Shalom
Photo: Nir Kedar

Palestinian finance minister: Economic peace failed

Bassem Khoury, the Palestinian minister for national economy, claims that Israel is not honoring economic stipulations of Oslo: 'If we have a state, it will prosper. But today we don't have state, but collection of isolated islands.' Israel's Regional Development Minister Silvan Shalom: 'Both sides need to remove barriers – Israeli bureaucratic barrier and Palestinian non-cooperation barrier'

Palestinian Minister for National Economy Bassem Khoury, speaking Wednesday at a conference at the Peres Center for Peace in Tel Aviv on economic peace, a concept being promoted by Prime Minister Benjamin Netanyahu, explained why the Palestinians are not jumping at the opportunity of economic peace.


"Economic peace was already attempted in the past and it failed," said Khoury at the conference. "A majority of the Oslo agreements were economic. The agreement included an Israeli commitment to Palestinian work in Israel and a passage of Palestinian goods between the West Bank and Gaza. However, Israel did not honor even one article of the Paris Accords (the economic adjunct of the Oslo Accords. T.G.)."


Bassem Khoury (L) and Silvan Shalom at the Peres Center (Photo: Nir Kedar)


"Before Oslo, the Israeli GDP was 11 times bigger than the Palestinian GDP. Five years later, it was already 20 times bigger because the Israeli economic flourished while the Palestinian economic shrank, and this is much before the second intifada. Today, our GDP is 35% smaller than our GDP in 1991," said Khoury.


"We know how 'to fish' very well, and if we have a state, it will prosper. But today we don't have a state, but a collection of solitary islands because of the lockdown on the Gaza Strip, restrictions on movement with the West Bank, and the lack of movement between the West Bank and the Strip," Khoury explained.


Deporting foreign workers benefits Palestinians

Israeli Regional Development Minister Silvan Shalom also spoke at the Peres Center for Peace conference, agreeing for the most part with Khoury, but with a different interpretive twist.


According to Shalom, "There are joint economic projects between Israel and the PA – in Jenin, Bethlehem, Jericho, and Tarqumiya – that have been stalled for years, and it is a shame that this is the case. Some of this is our fault – unnecessary Israeli bureaucracy that holds things up."


Minister Shalom mentioned that "even joint projects with the Jordanians experience delays because of Israeli bureaucracy. We ask any Jordanian worker who wants to cross into to Israel to wait two months for visa and to pay NIS 90 (about $24) entry fees per day. It is not realistic to expect him to work once every two months and to pay half of his salary to customs.


"However, the economic cooperation between Israel, Jordan, and Egypt is a great success. In 1999, Jordanian exports to the US totaled $13 million. In 2005 following the QIZ (qualified industrial zone) agreement, it reached $1.5 billion.


"We must recognize that the desire for normalization is the fundamental Israeli desire. We see normalization of relations as the objective, while Arabs see it only as a means to advancing economic interests. Also the Palestinians always prefer the political interest to the economic interest. This complicates things," said Shalom.


"Despite this, I think that the two sides need to remove barriers – the Israeli bureaucratic barrier and the Palestinian non-cooperation barrier. The four industrial zones need to be opened immediately. This is not in conflict with the political peace process, which is also critical," explained Shalom. The four industrial zones the minister spoke of were established in 1994, but have yet to start operating because Israel has yet to connect them to the water and electricity grids.


Shalom committed to take the necessary actions to remove the bureaucratic barriers stalling economic cooperation between the Israelis and the Palestinians, starting with keeping Allenby Bridge, which connects between Israel, Jordan, and the West Bank, open until midnight in order to help out the Palestinians.


Within this context, the minister presented the initiative to deport foreign workers from Israel as a move that will benefit the Palestinians. "When there are too many foreign workers in Israel, they first of all take the jobs of Palestinians," he said.


פרסום ראשון: 07.30.09, 09:15
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