While the political horizons have collapsed on them, Palestinians now face the deepest economic crisis in recent memory. A backlash is inevitable, writes Mustafa Barghouthi Current developments in Palestine drive home the following points: - The Oslo Accords and associated annexes, inclusive of the Paris Protocol on Economic Relations, have reached their inevitable dead end. - The theory, espoused by Western nations, that the promotion of Palestinian economic development and institution building under the ongoing Israeli occupation is the only avenue to the establishment of an independent state has similarly collapsed. - The negotiations that went by the name of the "peace process" and the belief that the US would assert meaningful pressure on Israel in this context were pure illusions. Any residual faith in this process has evaporated and the process is long past is sell-by date. The gruelling economic crisis that grips Palestine today has exposed the magnitude of the fiction of the possibility of Palestinian economic development under an occupation that has developed into the worst model of systematised racial discrimination and apartheid in history. It is no longer possible to escape the essential problem, which is the need to confront the Israeli drive of settlement expansion and subjugation which is destroying all possibility of territorial contiguity and, hence, the prospect of building a viable independent state, and which is simultaneously destroying the foundations of Palestinian economic development and survival. Economic dependency in the occupied territories is not limited to reliance on assistance from donor countries. In fact, it is rooted in the inability of the Palestinian Authority (PA) to take any decisions independently from the restrictions imposed by the Oslo Accords and the Paris Protocol. Those who remained silent in the past over these iniquitous terms are paying the price for their silence today. Because Israel controls most of the taxes that are levied on Palestinians, it has the power to use the remittance of these revenues to the PA as a means of political extortion. The supposedly brilliant idea of promoting a consumer economy under the occupation as an alternative to the development of a free economy as part of the national liberation struggle appears ludicrous today when we consider that Israel fully controls more than 80 per cent of the West Bank and prohibits any independent economic activity on 62 per cent of this territory. Consider, too, that the entrenchment of the divides between Jerusalem and the West Bank and between the West Bank and Gaza has prevented the rise of a unified Palestinian market; that Israel controls 90 per cent of the water resources in the West Bank and forces the Palestinians to pay double the rates that Israelis pay for water and electricity; that the unified customs and tax system compels Palestinians to pay Israeli prices for goods and products in spite of the fact that the per capital income of Israelis is 25 times greater than that of Palestinians. For Palestinians in Gaza, the situation is grimmer yet after six years of a brutal economic siege with its enormous economic and human toll. To compound the injustice, Israel utilises the land and water it confiscates in order to build profit-making Israeli enterprises and it uses the billions of dollars these generate in order to build and expand Israeli settlements and to sap what remains of the limited natural resources of the occupied territories. Five years after the adoption of the "economic development under occupation" theory, Palestine has the fifth highest unemployment rate in the world. Unemployment among educated youth in the West Bank and Gaza has reached 80 per cent. It is little wonder why this segment of the population makes up the largest proportion of participants in the current protest movement in the West Bank against the rising costs of living, poverty and unemployment. Due to pressures from Israel and some donor countries, the Palestinian Authority has to allocate 30 per cent of its already meagre budget to its security agencies. As a consequence, allocations for education, health, social affairs and agriculture have declined. Agriculture now receives 0.8 per cent of the PA budget, in spite of the fact that Palestine is an agrarian country and the resistance against the occupation needs a strong agricultural sector. What the foregoing tells us is that Palestine needs a radically different economic approach, one that strengthens the people's ability to remain steadfast in their resistance against the apartheid system. Such an approach is a world away from the one that shackles the Palestinians in debt and keeps them prey to the forces of a neoliberal/consumerist economy that traps them in the daily scramble to make ends meet. Dov Weisglass, former senior advisor to Ariel Sharon, summed up the situation elegantly. He said that the Oslo Accords were the best stroke of genius Israel had ever had because they perpetuate the occupation while minimising its costs, which were shifted onto the shoulders of the Palestinian people and donor nations. It made the occupation profitable. The Palestinians must have set a world record not only as the people that has lived the longest under a foreign occupation but as the only people that were forced to foot the bill of the occupation as well. These days, some donor nations also want to shed their share of the burden of the costs of occupation onto the Palestinian people. This helps explain the PA government's misguided decisions to raise taxes, to increase value added tax, and to refrain from intervening to stem the mad spiral in the prices of fuel and foodstuffs. The Palestinians have watched their political horizons close in on them against the backdrop of a debilitating and seemingly intractable internal rift. Add to this rampant unemployment, galloping inflation, mounting poverty and the increasing strains of living from one day to the next. Is this not a recipe for explosion? The writer is a member of the Palestinian parliament and secretary-general of the Palestine National Initiative.
