State Secretary Raymond Johansen (chair)

Ad Hoc Liaison Committee (AHLC) meeting

14 December 2005, Lancaster House, London

Excellencies

Ladies and Gentlemen

It is a pleasure for me to welcome you all to this informal meeting of AHLC donors and partners here in London. Let me start by thanking our British hosts for a warm reception and for providing this impressive setting for our deliberations.

Let me also assure the Ministers of the Palestinian Authority that your presence is highly appreciated. Furthermore, it is a special pleasure to have The Quartet’s Special Envoy, James Wolfensohn among us, and as always we are pleased to see our Israeli friends again.

Our first AHLC Meeting since December last year, offers the donor community a chance to reflect on the past year and to preview international support in 2006.

Extraordinary changes have taken place in the region in 2005. A unique opportunity has opened up for the parties and the international community to revive the peace process and to accelerate a return to the Road Map.

After four years of crisis, 2005 emerged as a year of cautious optimism. The successful election of a new President of the PA in January, the Sharm-el-Sheikh agreement in February, a notable drop in violence, and Israel’s historic disengagement from Gaza and parts of the West Bank, changed the political environment in significant ways.

In July at the Gleneagles summit, and following a report from the Quartet Special Envoy, the G8 made a commitment in principle to raise US$ 3 billion per annum in public and private finance if the parties fulfilled their obligations.

The agreement concluded on 15 November between Israel and the PA to open an international border crossing between Gaza and Egypt and to increase freedom of movement for people and goods in and between the Palestinian areas was yet another important step forward. We are all greatly indebted to The Special Envoy who together with Secretary of State Condoleezza Rice and the assistance of the High Representative of the European Union, Javier Solana brought the negotiations to a successful conclusion.

However, the real litmus test will be for the parties to honour their commitments in accordance with the agreement. We strongly urge them to do so.

At the same time as new windows of opportunity have opened, the construction of the Barrier and settlement expansion continued. In the West Bank, internal closures have continued to hamper prospects for economic recovery. The security situation remains highly problematical, in particular in Gaza, and needs to be addressed on an urgent basis.

Under the Roadmap both parties are obligated to avoid unilateral actions which prejudice final status issues. Any final agreement must be reached through negotiations between the parties and a new Palestinian state must be truly viable with contiguity in the West Bank and connectivity to Gaza. We hope that the upcoming elections in both Israel and in the Palestinian Territory will provide the respective governments with a popular mandate to go to final status negotiations.

In Oslo we adopted an agenda aiming at ensuring substantial GDP growth, and thereby reducing unemployment and poverty. All three parties---the PA, Israel and the donors---had to take determined action if this was to happen.

The PA had to bring violence against Israel to a standstill, respect the requirements for fiscal discipline and create an internal governance environment attractive to private investors.

Israel needed to restore Palestinian movement and access, without which economic revival will be impossible.

Donors needed to continue providing high levels of financial support, and, if the parties showed commitment to change, to increase their assistance levels even further.

The Oslo-agenda is even more valid now as it was a year ago. This meeting will provide an opportunity to address these and other important issues such as improved political conditions and reforms needed on the Palestinian side in order to bring real social and economic development. Despite the ongoing problems, we should discuss how we can build on the opportunities presented by the recent breakthroughs.

Thank you

Read the Chair's summary of the meeting here