Transcripts: Money to Palestine, Economic Pressure on Israel?

On Friday, the U.S. State Department stated that $200 million, as part of a $900 million pledge from March, was on the way to the Palestinian Authority. On the same day, Deputy State Department spokesman Robert Wood said, "It's premature to talk about imposing economic sanctions on Israel."

So could this really be a new American economic approach to carrots-and-sticks on Israel and Palestine? There is no problem with the $900 million pledge to Palestine but there may be a problem on the 2007 Memorandum on Understanding calling for $30 billion. over 10 years, to Israel?

The Statement on Direct Budget Assistance to the Palestinian Authority:

The United States is the leading provider of bilateral economic and development aid to the Palestinians, providing an estimated $2.5 billion through USAID since 1993. The $200 million in direct budget assistance to the Palestinian Authority (PA) that the Secretary announced July 24 represents the single largest transfer of budget support to the PA from any country since its inception. It is a part of the $900 million pledge for 2009 that the Secretary announced at the March 2 donors’ conference in Sharm al-Sheikh to address the immediate needs of Palestinians in the West Bank and Gaza and support our longer-term approach of fostering the conditions in which a Palestinian state can be realized.

The United States is committed to improving the humanitarian situation in Gaza. In 2009, the United States has provided more than $72 million to date in humanitarian assistance to the people of Gaza through the United Nations Consolidated Appeal (CAP) and other partner organizations.

In 2008, the U.S. was the single largest national donor to the Palestinian Authority. The U.S. exceeded its Paris Donors’ Conference pledge of $555 million (December 2007), committing more than $600 million in assistance to the PA in calendar year 2008, including:

· $239 million for activities in economic growth, democracy and governance, food assistance, education, health, and water supply to the PA.

· An additional $300 million in direct budget support to the PA for debt owed to commercial vendors and financial institutions.

· $75 million for security sector reform.

In addition, in fiscal year 2008 the U.S. provided $184.7 million in Migration and Refugee Assistance (MRA) and Emergency Refugee and Migration Assistance (ERMA) funds to United Nations Relief and Works Agency (UNRWA) for assistance to Palestinian refugees in the West Bank, Gaza, Jordan, Lebanon, and Syria.

Robert Wood's statement:

QUESTION: Would U.S. be ready to exert some financial pressures on Israel to convince the government to stop settlements?

MR. WOOD: Well, Sylvie, it’s premature to talk about that. What we’re trying to do, as I said, right now is to create an environment which makes it conducive for talks to go forward. And as I said, Senator Mitchell is working very hard on this. And what we all need to do in the international community is support this effort, and that means Americans, that means Arabs and Israelis, to do what they can to kind of foster a climate in which the two sides can come together and negotiate their differences peacefully so that we can get to that two-state solution.

QUESTION: But Robert --

MR. WOOD: Yes.

QUESTION: Dan Meridor has said – that the agreement we had with the Americans is binding on us and them. And he added that they should keep to the agreement. He’s calling the U.S. to keep to the agreement.

MR. WOOD: I think we’ve been very clear with regard to settlements. They need to stop, and that includes natural growth. I don’t have anything more to add to that. The Israelis are well aware of our position. And we’ll obviously continue to have talks with the Israelis on this subject and other issues, but our policy remains the same.

Booom: U.S. Agrees to Israeli strike on Iran in return for a Palestinian state?

On Thursday, The Times reported that Western and Israeli diplomats are in talks concerning international support for an Israeli pre-emptive strike on Iran, in return for concessions on a two-state solution.

The passage of two Sa'ar 5-class Israeli missile-class Navy ships through the Suez Canal on Tuesday was offered as the proof of seriousness of the Israeli position. The deployment of these two warships in the Red Sea followed the passage of a Dolphin-class submarine capable of launching a nuclear missile strike through the international waterway.

“This is preparation that should be taken seriously. Israel is investing time in preparing itself for the complexity of an attack on Iran. These manoeuvres are a message to Iran that Israel will follow up on its threats” an Israeli defense official said.



Ahmed Aboul Gheit, the Egyptian Foreign Minister, said that his government explicitly allowed passage of Israeli vessels, and an Israeli admiral said that the drills were “run regularly with the full co-operation of the Egyptians.” This, alongside the claim that Saudi Arabia would allow Israeli jets to use its air space in any strike against Iran, could be seen as another indication of the high possibility of an Israeli raid- one which would have the backing of pro-Israeli Arab states who oppose a nuclear-armed Iran.

A British diplomat has said that, if agreed, an Israeli strike would be possible “within a year.”

Tel Aviv may be using the “existential threat” of Tehran in order to gain extra time which could bring onboard more conciliatory Palestinian leaders, pushed by the Obama administration. Or it may be seriously focusing on a pre-emptive strike which could, again, give it extra time in the peace process, even if a war between Israel and Iran would cause turmoil in the entire region. However, in the second case, Israel would be losing 'the other', which would shatter geo-political, geo-cultural and geo-economical institutions and could cause an identity crisis.

For me, a Washington-led Western camp would go no further than imposing tougher sanctions against Tehran. As I mentioned above, the war would not be limited to two states and would change the dynamics of the entire region. Therefore, the first scenario sounds more logical: an Israeli bluff calling for the acceptance of Israeli demands from the Palestinian Authority. The Obama administration cannot leave Israel on its own. Pushing Palestinians toward the negotiating table along with extra tangible efforts to bring other Arab states, especially Syria, into a wider negotiation platform seems more logical.

On the other hand, news from the other side of the story comes in, and Hamas completes the last piece of the puzzle. Hamas is enjoying the new conjuncture being shaped by the State of Israel. The first Qassam rocket since June 13th was fired into the western Negev Thursday evening by militants in the Gaza Strip. Hamas wants to show that it should not be overlooked in the negotiation process.