Why does Prime Minister Fayyad wish to ‘improve’ the Paris Protocols, despite the severe limitations that it imposes on the PA’s ability to choose their own economic regime and adopt trade policies?
By Neve Gordon
Triggered by gas-price increases, tens of thousands of Palestinian taxi, truck and bus drivers in the West Bank observed a one-day strike, effectively shutting down cities. This, as Al Jazeera reported, was the culmination of several days of protests where thousands of Palestinians, frustrated by the economic crisis in the West Bank, took to the streets. After these protestors forced the closure of government offices, Prime Minister Salam Fayyad decided to decrease fuel prices and cut the salaries of top Palestinian Authority officials in an effort to appease his angry constituents.
Most Palestinian analysts maintain that the Oslo agreements are to blame for the collapse of the Palestinian economy.
Prime Minister Fayyad, a former IMF executive, undoubtedly knows that both his previous decision to increase gas prices as well as his recent decision to decrease them will have no real effect on the looming economic crisis. Report after report has documented the Palestinian economy’s complete dependence on foreign aid, while underscoring the severe poverty and chronic food insecurity plaguing the population. These reports all suggest that Israel’s occupation is to blame for the unfolding economic debacle, raising the crucial question of why the Palestinians’ wrath was directed at Fayyad rather than at Israel.
The clue to this enigma can be found in the missing chapter of a World Bank report published barely a week after the protests subsided. Warning that the fiscal crisis in the West Bank and Gaza Strip is deepening, the World Bank blamed the Israeli government for maintaining a tight grip over sixty percent of the West Bank, denying Palestinians access to the majority of arable land in the area as well as limiting their access to water and other natural resources.
Remarkably, the economists who wrote the report highlight the impact of severe Israeli restrictions to Palestinian land but say nothing about economic policy. They seem to suggest that if only the Oslo process had been allowed to go forward, then the Palestinian economy would not be so badly off. Therefore they fail to mention the detrimental effect of the Paris Protocols, the Palestinian-Israeli Interim Agreement of April 1994 that spells out Oslo’s economic arrangements.
Interestingly, the three foundational documents that Fayyad has published since he began his tenure as Prime Minister—Palestinian Reform and Development Plan from 2008; Ending the Occupation and Establishing a State from 2009; and Homestretch to Freedom from 2010—also fail to discuss the stifling effect the Paris Protocols have had on Palestinian economy.
Spanning thirty-five pages—as opposed to NAFTA’s thousand pages—this economic agreement reproduces Palestinian subjugation to Israel, while undercutting the very possibility of Palestinian sovereignty. The agreement’s major problem, as Israeli economists Arie Arnon and Jimmy Weinblatt pointed out over a decade ago, is that it establishes a customs union with Israel based on Israeli trade regulations, allows Israel to maintain control of all labor flows, and prohibits the Palestinians from introducing their own currency, thus barring their ability to influence interest rates, inflation, etc.
Why, we need to ask ourselves, does Prime Minister Fayyad wish to “improve” the Paris Protocols, and why doesn’t the World Bank even mention the agreement, needless to say the severe limitations that it imposes on the Palestinian Authority’s ability to choose their own economic regime and adopt trade policies according to their perceived interests?
The answer has to do with a shared and ongoing investment in Oslo.
Prime Minister Fayyad, the World Bank and indeed most western leaders perceive the current economic crisis in the Palestinian territories as resulting from the collapse of the 1993 Oslo process. They would like to bring Oslo back on track, develop and expand it. By contrast, most Palestinian analysts currently maintain that the Oslo agreements are to blame for the collapse of the Palestinian economy.
The protesters know that the West Bank’s fragmentation, the Palestinians’ inability to control their own borders and the lack of access to huge swaths of land (which are highlighted in the reports), are intricately tied to the untenable customs union and the absence of a Palestinian currency. These restrictions are all part and parcel of the Oslo Accords and not an aberration from them.
Hence, it would be rash to think that the Palestinian protesters are blaming Prime Minister Fayyad for the economic crisis, since every West Bank resident knows all too well that the crisis is the result of the occupation. It consequently seems reasonable to assume that they are blaming Fayyad for continuing to play the Oslo game.
Palestinians have no sovereignty in the Occupied Territories, and yet they have a president, a prime minister and an array of ministers who for years now have postured as part of a legitimate government in an independent country. The only way to end the occupation is by forsaking Oslo; to force the Palestinian Authority to stop playing this futile game and to deal head on with its disastrous repercussions.
Neve Gordon is the author of Israel’s Occupation and can be reached through his website. This article was first published in Al Jazeera.
For additional original analysis and breaking news, visit +972 Magazine's Facebook page or follow us on Twitter. Our newsletter features a comprehensive round-up of the week's events. Sign up here.
Richard Witty
“Prime Minister Fayyad, the World Bank and indeed most western leaders perceive the current economic crisis in the Palestinian territories as resulting from the collapse of the 1993 Oslo process. They would like to bring Oslo back on track, develop and expand it. By contrast, most Palestinian analysts currently maintain that the Oslo agreements are to blame for the collapse of the Palestinian economy.”
In a critical point, “most analysts” is avoidance. Name names please, with some citations would be helpful to follow up.
“The only way to end the occupation is by forsaking Oslo; to force the Palestinian Authority to stop playing this futile game and to deal head on with its disastrous repercussions.”
And replace that process with what? Israeli full responsibility for occupation, usually implying more Israeli involvement/negligence in Palestinian life, accompanied by more dependency on Israeli largess and military law.
Agitation for a single state? And, in the 20 years until that happens, what then?
What do you propose?
“I won’t play” is really not enough.
XYZ
Gordon, like most radical Israel bashers, couldn’t care less about the Palestinians. He wants “revolution for the hell of it”. Making life better for the Palestinians is of no interest to him…even if Oslo had succeeded in creating an independent Palestinian state, he would still complain that the are “still being exploited” or “still being dominated” because this is the world-view of the radical “progressive” Left, whose unhappiness with the world as it is far transcends merely the Arab-Israeli conflict but includes “globalist capitalism” and other supposedly catastrophic problems like global warming, pollution, mining, etc, etc, etc.
Greg Pollock
Fayyad wants to retain Oslo because it has allowed the evolution of local patronage which has somewhat stabilized their bantu. I do not say this in rancor; I think they see no alternative to Oslo save for civil disorder, perhaps worse. “The protesters know…the West Bank’s fragmentation, the Palestinians’ inability to control their own borders and the lack of access to huge swaths of land…”: one could as well say “know…their inability to control their own BODIES,” for a form of null involuntary servitude is evolving, structurally.
Witty: the Israeli State cannot stop vanguard settlements; Oslo is dead through their inaction. Moreover, Bibi has made it quite clear that vanguard settlers will NOT be asked to leave. No one tells a Jew to leave his home, I believe he basically says.
XYZ: “supposedly catastrophic problems like global warming, pollution…”: global warming is very real; go to NASA to see the extent of Arctic summer ice loss. But denying the travails of others is a normal tactic for the XYZ label.
Kolumn9
Fayyad wants to retain Oslo because the alternative is anarchy and chaos with no silver lining whatsoever for the Palestinians.
Richard Witty
Fayyad wants to retain Oslo because it is a plausible path to a Palestinian state, Palestinian self-governance.
When people say that the “settlers will not be removed”, as a basis that Oslo is dead, they are wrong.
Not because the settlers must be removed. That concept is an addiction.
If the settlers remained as Palestinian citizens (not Israelis), and compensate to confidently transfer/perfect title to land, and prohibit segregation and/or ethnically defined privileges, then they should be allowed to remain (and without the gamble that I saw Ashrawi speak of “if they wish to apply for citizenship, we would consider it”.)
Oslo’s not dead. Its that it took much much more work to get to (fighting the Israeli stream and the Palestinian stream and the solidarity stream and the stream of random distracting events in the world).
What it takes is determination, imagination, flexibility, diversity of compatible emphases (so that if one effort is blocked there are others to pursue).
The common thread that stops Oslo is punitive approach, rather than mediative.
Fayyad is a mediator. Obama is a mediator. Its a good and effective role, not corrupt as repeated and repeated and repeated (until it is true). (I don’t know if Abbas, Fayyad, others are corrupt or not. I don’t think that the majority of solidarity posters that have done so ad nauseum, know either.)
Greg Pollock
Richard, the vanguard settlers are there for the glory of YHWH through Israel. The Israeli State, by allowing the encorachments to continue, attaches this land ideology to itself. Such settlers will not be part of a Palestinian quasi state (without control of its own borders); they want prior residents out, and show so in their actions. Another Israeli regime could change this, but there is to date no electoral evidence for such a regime.
The PA wants to retain what it has; they live that, and they think anything else will lead to “confusion,” as Arafat used to say. One State is not a solution but long term outcome. Two States could be a resolution, not all nice, but there is absolutely no evidence that king Bibi will go there. I know Two States seems the only Jewish way out; but a Jew has decided not to go there.
Michael
This is a really confusing article in need of substantial editing. I’m emphatically in favor of independent media but that doesn’t mean abolition of editors. There are enough buzzwords and recognizable positions to spark the usual flame wars but what is he trying to say?