Israel and Palestine: Can there be Peace?

There can be no Peace Without Economic Justice in Palestine

by Kamran Mofid, Ph.D.

As recent as last week, Secretary of State Condoleezza Rice met with Israeli and Palestinian leaders and urged them to step up their efforts to find a lasting peace.
“Everybody recognizes that the creation of a viable, independent democratic Palestinian state that can live side by side in peace with Israel would be not just a remarkable achievement but a just achievement,” Rice said in a news conference with the Palestinian president, Mahmoud Abbas, in the West Bank town of Jericho.
Rice also held talks with the Israeli prime minister, Ehud Olmert, in Jerusalem, in which she expressed her appreciation for remarks Olmert had made earlier in the week as an “important step that was likely to both contribute towards calm and advance the peace processes in the region”. Moreover, in the last few days the Baker-Hamilton report on Iraq has recommended attempts at a revival of the Israeli-Palestinian peace process.

As everybody knows, we have been here many times before: so many peace processes and so many failures with tragic consequences for all. This is so, because those promoting such proposals, it seems, have failed to acknowledge that, the key which will open the door to peace is called justice. Furthermore, there will be no peace between Israel and Palestine, and no true security for Israel, so long as there exists such a level of poverty, inhumanity and economic injustice in Palestine. The words and sentiments of the UN Report on Palestine which was released yesterday (7/12/06) rings true, a gist of it can be noted below.

UN aid agencies launched their biggest appeal for funding to tackle the humanitarian crisis in the Palestinian territories, asking for $453m for next year and warning of a weakening in the Palestinians’ ability to govern.

Senior UN aid officials in Jerusalem said there were clear signs of a worsening economic crisis. Around two thirds of the 4 million Palestinian population were living below the poverty line and half the population were “food-insecure”, meaning they could not afford the basic foods to meet dietary needs. Unemployment was running as high as 40% in the Gaza strip and at around 25% in the West Bank. Kevin Kennedy, the UN humanitarian coordinator, said the crisis was not only an economic collapse but was also tied to an increase in closures and access restrictions imposed on the occupied territories by the Israeli government and to continued conflict, internal political fighting and a breakdown of law and order.

The UN has warned there has been a gradual weakening of the Palestinian Authority. The crisis results from an international boycott imposed in March after the Hamas militant movement won elections and formed a government. Israel has since withheld $60m a month of tax revenues that should go to the Palestinians.

Although some of that money has been spent paying the Palestinian bills of Israeli electricity and water companies, the Israelis have now withheld nearly $600m.
The international community, under the Quartet of the US, the UN, the EU and Russia, has also halted direct funding to the Palestinian government, saying it must recognise Israel, halt violence and accept past peace agreements. The freeze means salaries for 160,000 government workers have largely gone unpaid. “Obviously the longer the current situation continues, with further deterioration, a lack of salaries, people on strike, continued military conflict on both sides, [the] further [the] weakening of the Palestinian Authority and its institutions”, the Report notes.

In the past year, the UN observes, there had been a 40% increase in the number of barriers and checkpoints across the West Bank. In addition, there have been continued closures of the crossing points for people and goods out of Gaza. Under an agreement negotiated last November, Israel was to open up the main crossing points to relieve the economic crisis. But the crossings have in effect been closed, with Israel citing security concerns.

How Can a Lasting Peace Process Move Forward?

Sound economic policies, effectively implemented, are essential elements of the peace process in the Middle East. “Economics of Hope”, leading to envisioning, enabling and empowering the disposed and marginalised people of Palestine is the most effective path to a non-violent resolution of conflict in the Middle East and a long-term security for Israel. Without economic empowerment, leading to tangible economic wellbeing and prosperity, all forms of peace proposals and dialogue, although valuable, will remain ineffective in realising their overall objective: peace, security and harmonious living, side-by-side.

Hopelessness Leads to Violence

Experience in the Holy Land has shown that hopelessness leads to violence, but the prospect for empowerment leads to peaceful coexistence. Calm and relative cooperation prevailed after the successful negotiations at Camp David over 25 years ago, after the Oslo agreement of 1993, and during and after the Palestinian elections of 1996. These were times when moderate leadership and sound judgment prevailed, and there was hope that further progress would be made. Tragically, radical and violent actions subsequently intruded, exemplified by the assassinations of peacemakers President Anwar Sadat and Israeli Prime Minister Yitzhak Rabin and the unconscionable suicide bombings, missile and bomb attacks, destruction of homes, and other acts of violence that continue today

Needed – Peace through Economic Development

The Palestinians are today the largest per capita recipients of foreign aid in the world. According to the 2004 World Bank report, they are suffering “the worst economic depression in modern history”: 75% are impoverished, and unemployment rates are 60-70% in Gaza and 30-40% in the West Bank. Without external support, the Palestinian infrastructure and basic services would not survive. Agriculture, trade and tourism all in ruin, creating hopelessness, helplessness, anger and frustration- a perfect environment for enemies of peace, reconciliation, dialogue, security and prosperity for Palestinians and Israelis alike.

The Path to Peace, Reconstruction, Security and Prosperity: Challenges and Opportunities

It is increasingly apparent that the problem of economics is not just a technical problem for experts but is above all a moral and spiritual issue. The world is longing for a system that would be both participatory and socially just; a system with a functioning economy that would be at the same time sensitive to theological consequences.  We must deal with the issue of economic empowerment that has a religious tract. Through our indifference and complicity, the integrity of our faith is in jeopardy.

People everywhere, given a chance prefer to be compassionate, spiritual and caring. They want to be able to practice their religions freely. More and more, they also want to see that their religious values have a bearing on their economic systems and structures. This philosophy is nowhere stronger than in the Middle-East, whose people by and large are very spiritual, religious, hospitable, informed and cultural. They largely do not reject the pivotal values behind the market economy. Indeed, the Middle-East region throughout the history has been the major area of, and for, business, trade and commerce. They do know that, under the right conditions, a market economy can drive development, decrease poverty, encourage productivity, and reward entrepreneurial energy.

The children of Abraham in the Middle East know well that religion is a major factor in the formation of social networks and trust. In addition, the impetus for focusing specifically on spiritual/theological economics draws on the growing recognition in economics and other social sciences that religion is not epiphenomenal, nor is it fading from public significance in the 21st century and the importance to social/economic dynamics of human economic intangibles. Recent developments in the social sciences suggest a growing openness to nonmaterial factors, such as the radius of trust, behavioural norms, and religion as having profound economic, political, and social consequences.
Spiritual Economics, Reconstruction and Development in West Bank and Gaza

Palestinian Economy: An Overview

The Palestinian economy is made up from the following industries:

Construction – this is one of the biggest sectors of the Palestinian economy. Demand for his sector is from the rapidly growing population, displaced persons still living in squalid camp conditions and reconstruction of war damaged property.

Agriculture is one of the biggest exporting sectors of the Palestinian economy and is also a major source of employment. Demand for this sector is expected to rise due to cost advantage enjoyed by this sector and growing demand from the local population.

Tourism is one of the major sources of foreign currency income for the Palestinian economy. With such world famous sites as Bethlehem and Jericho under its jurisdiction this sector is expected to contribute significantly to the economy of the Palestinian economy for the foreseeable future– as long as there is an absence of armed conflict.

Light manufacturing is one of the growing areas of the Palestinian economy. Sources of demand for this sector are from the local Palestinian population and also Israel where Palestinian products enjoy a strong cost advantage against their Israeli competitors.

The Palestinian Authority’s economy is largely dependent on the Israeli economy as most points of import and export are controlled by Israel’s security forces. Furthermore, Israel’s close proximity to the Palestinian market makes Israel one of its biggest trade partners. Subsequently the economic fortunes of the Palestinian economy are closely tied to the peace process. In times of calm between the two sides the Palestinian economy has witnessed marked improvements, especially in areas such as construction and tourism. Periods of peace have also been marked by higher rates of investment in its economy and lower rates of unemployment. In times of conflict such as the recent Intifada the reverse has proven true where as a result the Palestinian economy entered a period of major recession and even almost collapse.

Economic Forum for the Common Good: Areas of Concentration

As part of its vision to empower people to create a peaceful, prosperous and sustainable Middle East, The Economic Forum of the Globalisation for the Common Good Initiative- proposes the following sectors as the initial areas of concentration:

Faith and Economic life: The Economics of Reconciliation and Peace Building.

Beyond Corruption and Informal Economy: Good Governance and Economic Development for Peace.

Tourism for Peace.  Unlike many other regions in the world today, the Middle East has become synonymous with conflict. Images of wanton destruction and meaningless violence are commonplace. But there are other facets to the Middle East that are rarely seen, and the region’s history provides great examples of beauty, tranquillity, sacredness and peace. As children of Abraham, we should be concerned about ways of bringing our communities together for the good of all.

Agriculture for Peace. To support peace through policies leading to agricultural development increased employment and economic growth.

Business for Peace. It is our understanding that business is the dominant institution in society today and the one most capable of responding to rapid change. As such, business must adopt a new tradition of responsibility for the whole. It must do this by defining business interests within the wider perspective of society in order to create a positive and sustainable future.

Youth Leadership programme for Peace: Today’s youth in Palestine will one day lead their communities in various capacities, build their economies, and make decisions that will have an impact in the lives of future generations. A series of programmes on conflict resolution, good governance, peace making and economic development will be initiated. 

Economic and trade relation between the West Bank and Gaza.

Economic and trade relation between Israel and Palestine.
Economic and trade relation between Palestine and Egypt.

It is expected that the economics of hope for the common good, will lead to the creation of an environment which will foster a better understanding between the Israeli and Palestinian people, where many other equally important issues dividing them- such as the unity government in Palestine, the recognition of Israel and the acceptance of the past peace agreements by Hamas, etc- can be addressed and resolved. A hopeful Palestinian population, who enjoys the fruits of a just economy and trade relation with its neighbour, surely is better equipped to talk with Israel on the issues of security than other wise.

For a more detailed treatment of these issues please see:

http://www.islamonline.net/English/contemporary/2005/08/article02.shtml

* Kamran Mofid, a British Citizen of Persian origin, Founder, An Inter-faith Perspective on Globalisation for the Common Good Initiative; and the Co-editor, Journal of Globalisation for the Common Good. He was awarded a doctorate in economics from the University of Birmingham, UK.K in 1986. In 2001 he received a Certificate in Education in Pastoral Studies from Plater College in Oxford.

Dr. Mofid’s work is highly interdisciplinary, drawing on Economics, Politics, International Relations, Theology, Culture, Ecology and Spirituality. His writings have appeared in leading scholarly journals, popular magazines and newspapers.

His most recent book, Promoting the Common Good: Bringing Economics and Theology Together Again (With Rev. Dr. Marcus Braybrooke-2005) was published by Shepheard-Walwyn, London. Mofid’s other books includes: Globalisation for the Common Good (2002), The Economic Consequences of the Gulf War (1990) and Development Planning in Iran: from Monarchy to Islamic Republic (1987)

Web sites:
http://www.globalisationforthecommongood.info/
http://lass.calumet.purdue.edu/cca/jgcg/