The White House’s economic plan envisages $50 billion in regional investment projects over the next decade, more than half in the West Bank and Gaza, and the rest in Jordan, Egypt and Lebanon.
But the initiative has been met with widespread skepticism and already has been rejected by the Palestinian leadership, which complains that the U.S. administration cannot be an honest peace broker after taking several pro-
Israel measures, including recognizing the contested city of Jerusalem as Israel’s capital.
Palestinian officials refused to attend the meeting, prompting a decision that Israeli officials would not be invited, although a smattering of participants from both business communities were in attendance.
“You need two to tango, and the two of them are not here,” said one Western diplomat, who spoke on the condition of anonymity because of the sensitivity of critiquing U.S. policy.
The White House plan makes no mention of Palestinian aspirations for statehood or of ending Israeli occupation of Palestinian territories.
Rather, the plan pulls together previously proposed infrastructure projects, including a transport link between Gaza and the West Bank as well as increased capacity at Gaza’s power station to address crippling electricity outages. Some of the projects have been suggested by organizations such as the World Bank, the Middle East Quartet (the United States, Russia, the United Nations and the European Union) and the Rand Corp.
“Today is not about the political issues. We’ll get to them at the right time,” Kushner said.
Underscoring how politics and economics are intertwined, Israeli officials said Tuesday that they had cut fuel supplies to Gaza in response to incendiary balloons sent across the border into Israel. Power station officials said they had switched to using just one turbine to prevent the electrical supply from running out overnight.
A couple of key U.S. allies sent high-level officials to the meeting, including Saudi Arabia, which was represented by its finance minister, and the United Arab Emirates, by its minister of state for financial affairs. But Jordan and Egypt sent only mid-level Finance Ministry officials.
At the opening session, the moderator asked Mohamed Alabbar, the founder of UAE property firm Emaar, what he thought of the absence of Palestinian officials. “It would be amazing to have everyone in one room,” he said. “I feel like I represent them.”
On Wednesday, an eclectic roster of speakers are to address the meeting, including Treasury Secretary Steven Mnuchin, former British prime minister Tony Blair and Gianni Infantino, president of the FIFA soccer organization. The only scheduled Israeli or Palestinian speaker, Ashraf Jabari, a businessman from the West Bank city of Hebron, will participate in a session on developing local businesses, according to the program.
How the economic projects would be financed remains unsettled, and the Bahrain meeting is not intended to raise money, said a U.S. official, who spoke on the condition of anonymity to discuss the diplomacy surrounding the rollout of the plan.
“We’ve tried to make it as clear as possible; the expectations are pretty clear,” the official said. “We are putting something out there — we’d like to get feedback. We’d like to talk about it.”
Some participants were skeptical of the U.S. decision to skip straight to the economic part of the plan, a decision that Kushner told the Reuters news agency was made because it was deemed “less controversial” than the political component.
“There’s a small problem here,” said one business attendee, who spoke on the condition of anonymity to talk candidly about the summit. “You need peace and security and open borders before we can talk about a $50 billion investment. If you want to throw away money, you can invest in infrastructure without peace and security.”
Criticism that the United States is attempting to achieve “economic peace” without addressing political aspects is unfounded, the U.S. official said.
“Not only is economic peace not our plan, but we don’t actually think economic peace is possible — you are not going to get sustainable economic growth and reach our targets — unless you get that other stuff,” the official said.
But U.S. officials have said that the political side of the plan will now probably be delayed until at least November, with Israel heading to an unprecedented new round of elections after Prime Minister Benjamin Netanyahu failed to form a government following elections that his coalition won in April.
The U.S. official said what sets the new plan apart is the fact that it is “much more comprehensive” and regional.
A convergence in interests between Arab countries of the Persian Gulf and Israel over how to combat Iran has invigorated a drive for normalization, and some analysts say more movement in the peace process is needed for that to happen.
Iran is helping to drive the Arab states and the Israelis together “because of the existential threat,” said Rabbi Abraham Cooper, associate dean at the Simon Wiesenthal Center, who was attending the summit. “The more we can normalize the interaction, the better chance for Palestinians.”
But even given the Iranian threat, the atmosphere among Arab nations in the gulf is “not conducive” in the aftermath of U.S. measures seen as an attack on the Palestinians, said Emirati political science professor Abdulkhaleq Abdulla.
The UAE and Saudi Arabia are represented in Manama “because they want to please the Americans and be good with their Bahraini partners, but I’m not sure that they will be willing to put a penny into this plan,” he said. He added that he knows of at least three Emirati business executives who declined invitations from the U.S. Treasury Department to attend. With no mention of Palestinian statehood, “it’s a nonstarter,” he said.
But while rejections may have been expected on the Palestinian side, even Israeli business executives have had their reservations. One, with extensive business ties to gulf countries and with Palestinian projects, said he had been asked to attend but had decided against it, on grounds that attending could jeopardize existing quiet economic cooperation.
“A bunch of us are doing a lot in the region now,” he said, speaking on the condition of anonymity so as not to jeopardize business relationships. “Agriculture, start-ups: There’s a lot of demand, and Israelis are wanted there in the gulf, but as companies. There are some people who have a bit of a larger picture and are thinking there are some next steps. That’s great, and we are enjoying this, but it’s still not celebrated.”
“Some goodwill” is needed, he said, “in order for things to be channeled from the economic development to things that have wider significance.”
“What we are seeing is perhaps there were good intentions, but there are certain things you do and you don’t do,” he said. “There are certain people that are trusted, and others that didn’t necessarily build the same trust.”
The Israeli businessman said the people who are “making the breakthroughs on the ground” do not appear to be involved. “The other thing I don’t see is a political framework, which is interesting.”
But the Western diplomat said that as a background document, the economic plan is “very useful” and that people “shouldn’t be too worried” about shaking up an inefficient aid system.
Peace between Israelis and Palestinians, however, is “
a hard one to crack,” he said.