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Source: Office of the Quartet Representative (OQR)
27 May 2015

Positive agenda needed to improve daily lives of Palestinians

Wednesday, May 27, 2015 in Office of the Quartet Representative

At the meeting of the Ad-Hoc Liaison Committee in Brussels today, OQR Head of Mission, Mr. Kito de Boer, called for the economic empowerment of the Palestinian Authority, with a positive agenda to improve the daily lives of Palestinians, boost the investment and business climate and create jobs. He emphasised that while economic empowerment is necessary, it is a complement to rather than a substitute for political progress in securing long term peace and security for all parties.

OQR's report to the AHLC states: "The Palestinian economy remains heavily dependent on Israel. While a positive political horizon is essential for economic confidence, economic empowerment is vital to boost the Palestinian government's ability to govern its own economic affairs in line with development goals. This includes at the immediate stage a better implementation of existing agreements (especially the Paris Protocol), upgrading them where needed and ultimately replacing them with an alternative trade regime that could benefit both the Palestinian and Israeli economies for the longer term. A critical mass of measures by Israel and the Palestinians to enable free trade and investments will show the business and international community that there is a serious drive to improve Palestinian economic growth prospects."

Full text of Mr. de Boer's speech to the AHLC:

We have heard today that restarting productive political negotiations may take time.

Ordinary Palestinians don't have the luxury of waiting. We urgently need a positive agenda to improve the daily lives of Palestinians. An agenda of Economic Empowerment to complement the imperative of securing a political solution.

Economic Empowerment is broad. At its core it is about attracting investment to create productive jobs. Economic Empowerment also addresses root causes such as: Effective Government; Movement and Trade; Access to Land; and Reliable Infrastructure.

Twenty years ago the economy was in reasonable shape and on a par with many of its peers like Jordan and Egypt. Since the start of the Millennium, business has been in long term decline relative to its peers- in Gaza catastrophically so.

Whatever we have been doing has not been sufficient to stimulate the investment needed to create jobs.

A fresh look in order to develop a credible Economic Empowerment agenda is required.

I would like to highlight 3 areas of particular importance:

First the need to revisit the underlying architecture that underpins the economic and trade relationship between the Palestinian Authority, Israel and the rest of the world. This starts with the Paris Protocol. We believe that the time has come to start a 3 stage process:

Second is the need to develop a coherent National Plan to stimulate business investment and job creation.

It should worry us that business investment in plant and machinery has more than halved as a percentage of GDP from more than 12% in 1999 to below 5% today.

We should take inspiration from countries like Egypt and Jordan who have both created positive narratives around investment and job creation with the launch of their National Investment plans at Sharm el Sheikh and at the WEF on the Dead Sea.

Third, Movement and Trade continues to require attention. It remains critical to enhance the processes, procedures and infrastructure between the Palestinian Territory and Israel, Jordan and Egypt. Containerization, installation of conveyor systems, longer opening hours, as well as business and investor visas remain critical to lowering costs and attracting investment.

Most urgent of all is Gaza. Reconstruction is critical. Water and Electricity are fundamental for both humanitarian and economic reasons.

Construction of a gas pipeline from Israel into Gaza is a precondition for affordable energy and the much needed large scale Gaza desalination plant.

We are, however, crystal clear that economic empowerment is necessary, but not sufficient. An agenda to improve the investment and business climate is essential to create jobs and improve day to day life. It is a complement but not a substitute for political progress in securing long term peace and security for all parties.

Thank you.

Further information

Read the report to the AHLC in full (PDF)
The OQR prepares a report on its activities ahead of each meeting of the AHLC - a 15-member committee that serves as the principal policy-level coordination mechanism for development assistance to the Palestinian people. The AHLC is chaired by Norway and co-sponsored by the EU and U.S.

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