WASHINGTON: Six Palestinian economic and political leaders met on Thursday at the New America Foundation in Washington, DC to discuss the Palestinian effort to gain recognition and membership at the United Nations General Assembly on September 22. The event provided a compelling guide to the thinking of the Palestinian business and diplomatic elite in the weeks preceding the UN vote. The discussion focused on four major topics: the Palestinian economy, negotiations and relations with Israel, security and relations with the United States. The Palestinian Economy Nafez Husseini praised the disciplined approach of the Palestinian Authority (PA) to governance, economic reform and institution building. He claimed that the security structure and rule of law in the West Bank are excellent and that the reforms of Palestinian Prime Minister Salaam Fayyad are responsible for the territory's impressive 9.2% GDP growth rate and the reduction of the PA budget deficit from $1.8 billion in 2008 to $900 million in 2010. Husseini asserted that economic success is sustainable because of the entrepreneurial spirit of the Palestinian people and an educated population that produces 45,000 university graduates annually and has a literacy rate of 94 percent. He suggested loan guarantees and public-private partnerships as viable methods to sustain economic growth. Ambassador Hind Khoury argued that robust economic growth would decline with the continued construction of the separation barrier and preservation of hundreds of checkpoints dotting the West Bank. She argued that Israel should allow greater freedom of movement and economic activity in the West Bank, which would improve the Palestinian economy and establish a better environment for a peaceful end to the conflict. Zahi Khouri agreed and claimed that the West Bank and Gaza are an untapped $4 billion market. He believes that economic incentives will cause Israeli business leaders to lobby its government to end the occupation. Negotiations and Relations with Israel Hiba Husseini, an advisor to the Palestinian negotiating team, argued that the Palestinians have tried negotiations for more than two decades and they have barely improved the situation in the West Bank and Gaza. She characterized the UN gambit as a “legal means to a legal end” that would not prejudice the status of negotiations. She claimed that the PA leadership still believes that negotiations are the only way to produce a lasting, viable peace but that a second mechanism is needed in light of Israeli settlement building in the West Bank and East Jerusalem and the deteriorating situation in Gaza. She believes the UN vote—which is endorsed by Hamas—will facilitate Palestinian reconciliation, which is crucial to the resolution of the conflict. Wassim Khozmo concurred and declared that the two state solution is in jeopardy. He believes the Palestinian strategy is a prudent one because the UN will help enforce Palestinian demands and establish a state based on the 1967 lines in the West Bank and Gaza with East Jerusalem as its capital. Ambassador Khoury claimed that Israeli legitimacy is tied to the establishment of a Palestinian state and blamed the current impasse on the obstinacy of the Israeli government. She praised civil society leaders in Israel, who understand the obstacles to peace and are deeply committed to engaging with Palestinians to end the conflict. Khouri agreed and said that long-term Israeli thinkers sympathize with the Palestinian cause and realize a fair and sustainable two-state solution is necessary to ensure Israel's survival. However, he was pessimistic that Palestinian actions could alter Israeli behavior and claimed that only internal transformation in Israel would change its approach to negotiations. He lauded the “Israel Summer”—large populist demonstrations calling for drastic social reform in the Jewish state—as an encouraging development and hoped it would transform the behavior of the Israeli leadership. Security Levy worried that Israeli intransigence in response to UN recognition of a Palestinian state would provoke a violent response in the West Bank and Gaza, possibly resulting in a third intifada. Ambassador Khoury disputed this notion and argued that the status quo in the territories is the main source of Palestinian violence. She argued that the security infrastructure in the West Bank is an effective mechanism to diffuse aggression and cited the successful containment of violence during the 2008-2009 Israeli war in Gaza as evidence that the PA can quell bellicose actions emanating from its territory. US Response Levy asked Zahi Khoury how the UN move would affect relations between the Palestinians and the United States. Khoury said he had never seen Washington in such a panic and that the United States—and the international community writ large—has a moral responsibility to help end the conflict. He claimed that Americans should emphasize with the Palestinian struggle since it is rooted in the quintessential American values of liberty, justice and freedom. Rev. Dr. Mitri Raheb reiterated this position and asserted that the PA wants to spread these values to the Palestinian territories. He argued that the Arab Spring is a harbinger of a new free, democratic era in the Middle East, which “starts in Palestine.” In response to threats from the US Congress that it will discontinue aid to the PA if it takes its case to the UN, Khouri claimed the PA would remain solvent if it better manages its imports, exports and taxes and joked that American subcontractors would be most affected by a disruption in aid. He is still optimistic that Barack Obama can play a constructive role in negotiations but understands that due to the contours of American electoral politics he cannot make any serious, bold proposals until after the 2012 election. He also asserted that the US advisors Dennis Ross and David Hale dictate, rather than advise, and have not presented any viable alternatives to the vote at the UN. Outstanding Issues? Although the panelists provided an excellent overview of political and economic trends in the West Bank and an eloquent moral and legal argument for the establishment of a Palestinian state, they avoided many relevant issues and at times posited strangely quixotic plans for resolving the Israeli-Palestinian conflict. First, the panelists failed to discuss how the vote at the UN will reduce Israeli obduracy, which is essential to a two-state solution. Although recognition at the UN would undoubtedly be an important symbolic victory and provide some peripheral benefits to the PA, it will not curb the expansion of Israeli settlements in the West Bank and East Jerusalem, establish borders or resolve the problem of Palestinian refugees—issues that are crucial to the resolution of the conflict. Due to the extreme nature of the Israeli government, it will most likely entrench Israeli contumacy and inaction, especially in light of the deteriorating security situations on Israel's borders with Syria and Egypt and the end of high-level diplomatic relations with former ally Turkey. Furthermore, Khozmo's claim that the UN will help enforce a two-state solution along the 1967 lines seems wildly unrealistic in light of UN inaction on the issue over the preceding 44 years. The only outside actor who can change Israeli behavior is the United States. Unfair as it may be, the UN vote is likely to severely strain US-Palestinian relations and reinforce the refusal of the US to use its leverage to alter Israeli behavior. More relevant to the Palestinians is how the UN move changes the actions of Hamas. Although the PA can do little to change Israeli conduct, the behavior of Hamas remains a Palestinian issue. While most rational observers agree that the PA has taken bold, constructive steps to make peace with Israel, Hamas remains an obstacle to any two state solution. In recent years, the Palestinian cause has gained momentum and many adherents in the international community but the refusal of Hamas to recognize Israel's right to exist and abandon violence continues to undermine negotiations, erode the Palestinians' moral position, destabilize the region's security and provide Israel an excuse for aggressive military action. True Palestinian reconciliation and the rejection of violence by Hamas—issues not affected by recognition at the UN—will provide the internal, regional and international momentum necessary to achieve a two state solution. The panelists asserted that the symbolic victory, international support, parallels to Israel's founding and non-violent manner of the Palestinian gambit at the UN will act as a clarion call to Israelis and the international community that the time has finally come to solve the Israeli-Palestinian conflict. While their hope is laudable, if history is any guide, it appears that the UN vote will be a Pyrrhic victory that further delays the realization of a two-state solution. Panelists: Zahi Khouri, Founder and Chief Executive Officer, Palestinian National Beverage Company; Member, Palestine Business Committee for Peace and Reform Hiba Husseini, Managing Partner, West Bank law firm ‘Husseini & Husseini;' Chair, Legal Committee to Final Status Negotiations Between the Palestinian and Israelis Ambassador Hind Khoury, Former Palestinian Ambassador to France; Former Palestinian Cabinet Minister, Jerusalem Affairs Rev. Dr. Mitri Raheb, Pastor, Evangelical Lutheran Christmas Church in Bethlehem; President, Diyar (Palestinian NGO) Wassim Khozmo, Senior Policy Advisor, Palestinian Negotiations Support Unit Nafez Husseini, VP, Digital Business, Consolidated Contractors Company Moderator: Daniel Levy, co-director of the Middle East Task Force at the New America Foundation; former Israeli peace negotiator. BM
