Norway chairs important meeting on Middle East in London

Friday 2 May the Ad Hoc Liaison Committee (AHLC) of donors to the Palestinians meet in London. The London meeting is a follow-up to the ministerial level donor meeting in New York in September and the large donor conference in Paris in December last year.

One of Norway’s most important contributions to the Middle East peace process is its role as chair of the Ad Hoc Liaison Committee (AHLC) of donors to the Palestinians. On Friday the AHLC donor countries will meet in London. In addition to Palestinian Prime Minister Salam Fayyad and Israeli Foreign Minister Tzipi Livni, representatives of the major donors, including UN Secretary General Ban Ki-Moon, US Secretary of State Condoleezza Rice, Russia’s Foreign Minister Sergey Lavrov, EU Commissioner Benita Ferrero-Waldner, EU High Representative Javier Solana and Quartet Representative Tony Blair will participate.

The purpose of the AHLC is to assist the Palestinians in establishing a sustainable, democratic state, which Norway believes is essential for a two-state solution to the Middle East conflict.

This can only be achieved if conditions on the ground are improved. Lately, the situation has deteriorated. There has been an expansion of Israeli settlements. More restrictions have been imposed on the Palestinians in the West Bank. There has been an increase in Israeli military operations in Palestinian Territory. Palestinian groups continue to fire rockets into Israel. Fragile governments on either side are hampering the negotiations. The Israeli and Palestinian populations have little trust in the peace process.

“Given the lack of progress in the peace process, donor cooperation is of greater political importance than ever,” said State Secretary Raymond Johansen. “In fact, the AHLC is the main arena for three-party consultations between the Palestinians, the Israelis and the international community on important issues. If we succeed in getting the parties and donors to commit themselves to providing better framework conditions for the Palestinian economy, we will at the same time be helping to improve the overall political climate,” the State Secretary continued.

The London meeting
The London meeting is a follow-up to the ministerial level donor meeting in New York in September and the large donor conference in Paris in December last year. “I am pleased that we have managed to re-establish our structured cooperation,” said Mr Johansen. This series of meetings marks the resumption of direct economic cooperation between donor countries and the Palestinian Authority after a period of boycott and isolation. In Paris, donors pledged a total of USD 7.7 billion. Norway will provide NOK 760 million each year during the period 2008–2010. This makes the Palestinian Territory on the largest recipients of Norwegian development assistance.

“An important aim of the London meeting is to follow up on and ensure fulfilment of the pledges made in Paris. This is no easy task,” said Mr Johansen. Given the deterioration on the ground, the challenge is to prevent that donors fail to fulfil their pledges because they fear that the funds will have no effect. We have a strong partner in Palestinian Prime Minister Salam Fayyad in our efforts to counter this tendency. He has launched an important, major reform of the Palestinian Authority, covering financial management, the judiciary and the security sector. The London meeting is important for mobilising political support for Mr Fayyad’s reform efforts.

At the same time, it is essential to improve the framework conditions for the Palestinian economy. With this in view, Norway is seeking to mobilise increased donor support for the Palestinian Authority’s budget, primarily through the World Bank Palestinian Reform and Development Plan Trust Fund. It is necessary to build a sustainable economy, and for that to happen, the Palestinian Authority needs to have a budget that allows it to implement policies, pay salaries to public employees and provide basic services such as health care and education to the population. As recently as 1999, the Palestinian Authority had a budget surplus.

The main obstacle to the development of the Palestinian economy is still the Israeli restrictions on access and movement. Without free access to and free movement within the Palestinian Territory, there will be no economic growth. Israel must remove checkpoints that have a significant impact on trade and economic development . There are currently nearly 600 checkpoints and barriers in the West Bank alone. Israel has legitimate security concerns, but it is not acceptable to hamper economic development in the Palestinian Territory.

A broader approach
Positive momentum in the donor cooperation is, however, not sufficient. It is now crucial that the significant donor effort  is based on a political process with the clear goal of achieving an agreement between Israel and PLO that gains acceptance among the Palestinian and Israeli people, ensuring a sustainable Palestinian economy and building institutions that provide the basis for a Palestinian state.

At present the prospects for establishing a state are slim. The aid that is provided is used mainly for salaries, current expenses and humanitarian assistance, and only to a limited extent for long-term development projects. “This is a trend we are seeking to reverse. Unless we succeed, the Palestinian Authority is in danger of collapsing. In that case, the institutional basis for a peace agreement would disappear. We cannot allow that to happen,” said State Secretary Johansen.