DPR Monthly Bulletin – Vol. XXIX, No. 9 – CEIRPP, DPR bulletin (September 2006) – DPR publication

September 2006

Volume XXIX, Bulletin No. 9

Bulletin

on action by the United Nations system and

intergovernmental organizations

relevant to the question of Palestine

Contents

 OCCUPIED PALESTINIAN TERRITORY

On 5 September 2006, Special Rapporteur on the situation of human rights in the Palestinian territories occupied since 1967 John Dugard submitted to the Human Rights Council, pursuant to its  decision 1/106, a  report on the violations of international humanitarian law and human rights in the Occupied Palestinian Territory.  The report is based on a visit undertaken by the Special Rapporteur from 9 to 17 June 2006.  The summary of the report is reproduced below (A/HRC/2/5).

Summary

The central feature of this report is the conflict in and the siege of Gaza.  On 25 June 2006, following the capture of Corporal Gilad Shalit by Palestinian militants and the continued firing of home-made Qassam rockets into Israel, Israel commenced repeated military incursions into Gaza and regular shelling of Gaza, causing numerous deaths and injuries, destruction of homes, agricultural land and infrastructure and resulting in the large-scale violation of human rights and international humanitarian law.  In particular, Israel has violated the prohibition on the indiscriminate use of military power against civilians and civilian objects.  The situation in the West Bank has also deteriorated substantially.

The wall presently under construction in the Palestinian territory is now portrayed by the new Government of Israel as a political measure designed to annex 10 per cent of Palestinian land situated between the Green Line and the wall, where some 76 per cent of the Israeli settler population lives.  When the wall is completed, an estimated 60,500 West Bank Palestinians living in 42 villages and towns will be enclosed in the closed zone between the wall and the Green Line.  The 500,000 Palestinians living near the wall require permits to cross it, and it is estimated that 40 per cent of the applications for permits are refused.

Israel continues its policy of the de-Palestinization of Jerusalem.  The wall is constructed in such a way as to place about a quarter of East Jerusalem’s Palestinian population of 230,000 in the West Bank.  Such persons will in future require permits to access their employment and to visit friends, hospitals and religious sites in Jerusalem.

Settlements continue to expand, in violation of the Fourth Geneva Convention.  The settler population in the West Bank and East Jerusalem now numbers over 440,000. The low wall under construction in south Hebron will make it difficult for Palestinian communities located between the low wall and the Green Line to access their lands, schools and clinics.

The number of checkpoints has increased, from 376 in August 2005 to over 500.  Permits for travel between different parts of the West Bank are granted sparingly and require Palestinians to subject themselves to arbitrary bureaucratic procedures.  Nablus and Jenin, in particular, have been seriously affected by checkpoints, and are today in effect imprisoned cities.  It seems that the main purpose of many checkpoints is to make Palestinians constantly aware of Israeli control of their lives and to humiliate them in the process.

The demolition of houses remains a regular feature of the occupation.  It has now become the practice to destroy houses in the course of effecting arrests in policing operations.  The destruction of houses for reasons other than military necessity is prohibited by international humanitarian law.

The family life of Palestinians is undermined by a number of Israeli laws and practices.  Recently, the Israeli High Court upheld a law which prohibits Israeli Arabs who marry Palestinians from living together with them in Israel.  The wall in Jerusalem has also resulted in the separation of families.

More than 10,000 Palestinians, including women and children, are imprisoned in Israeli jails.

The humanitarian situation in both the West Bank and Gaza is appalling.  At least 4 out of 10 Palestinians live under the official poverty line of less than US$ 2.10 a day and unemployment stands at least 40 per cent. To aggravate matters, the public sector, which accounts for 23 per cent of total employment in the Palestinian territory, is employed but unpaid as a result of the withholding of funds owed to the Palestinian Authority by the Government of Israel, amounting to $50-$60 million per month.  In addition, the United States and the European Union have cut off funds to the Palestinian Authority on the ground that Hamas, the party elected to Government in January 2006, is listed under their laws as a terrorist organization. Non-governmental organizations working with the Palestinian Authority have likewise been affected by restrictions on funding.

In effect, the Palestinian people have been subjected to economic sanctions – the first time an occupied people have been so treated.  This continues, despite the fact that Israel is itself in violation of numerous Security Council and General Assembly resolutions and has failed to implement the advisory opinion of the International Court of Justice of 9 July 2004.

The Quartet itself has no regard for the advisory opinion and fails even to refer to it in its public utterances.  This has substantially undermined the reputation of the United Nations in the Occupied Palestinian Territory.  Although Palestinians have a high regard for dedicated and committed United Nations workers on the ground, they have serious misgivings about the role of the United Nations in New York and Geneva.

The Conference was held at the United Nations Office at Geneva, on 7 and 8 September 2006, under the auspices of the Committee on the Exercise of the Inalienable Rights of the Palestinian People.  The theme of the conference was “Realizing the inalienable rights of the Palestinian people.”  At the close of the conference, the participating civil society organizations adopted a plan of action.

PLAN OF ACTION

We meet again, civil society organizations committed to ending the Israeli occupation of the Palestinian territories and to achieving the still unrealized rights, including the rights of self-determination and return of the Palestinian people. We anchor our work in human rights, international law, the Charter of the United Nations and resolutions, and a commitment to internationalism and a just peace and the belief that the UN remains central to ending the occupation.

We face a new crisis of war and occupation, a crisis in which Palestinians continue to suffer, even beyond the suffering imposed by decades of brutal occupation and apartheid.

The war against Lebanon and the continuing assault on Gaza have created new realities. Israel’s unilateralism has been exposed, and its Gaza “redeployment” has been shown false. The conditions of Palestinians living under occupation continue to deteriorate and Palestinian refugees continue to be denied their international rights, including their right of return. Palestinians in Jerusalem and elsewhere face ethnic cleansing.

The current crisis has undermined the United States’ effort to reorder the Middle East within a US plan justified in the name of “democratization.”  If democracy had any meaning at all, the United Nations and, indeed, every Member State, would accept the recent Palestinian election and establish full relations with any democratically elected authority in the Occupied Palestinian Territory – regardless of who the Palestinian people select. Instead, the international community, and the United Nations itself, have stood by, paralysed in the face of the US-orchestrated boycott of the Palestinian Authority and of Israel’s blatantly illegal kidnapping of 41 democratically-elected parliamentarians and eight cabinet ministers of that government. It is a badge of shame for us all.

Thirty years ago, the United Nations recognized, condemned and committed itself to oppose the international crime of apartheid. Crucially, it defined the crime of apartheid as a general crime against humanity, not specific to the then-reality of South Africa. Today, 12 years after the end of apartheid in South Africa, we are reminded that Israel continues to practice a system of apartheid and, further, perpetuates the longest occupation in recent history. We civil society organizations and activists from around the world join with the United Nations once again to identify, condemn and commit ourselves to opposing these heinous crimes.  As we were in the past, we are again determined that the perpetrators of that crime be brought to justice.

Despite the two-year old advisory opinion of the International Court of Justice, which held Israel’s apartheid wall to be illegal, the construction of the wall is nearly complete. The wall encircles Palestinian towns and cities in the most massive land-grab since 1967.  We call on the United Nations to implement the totality of the Court’s opinion – especially the section calling for the illegal wall to be dismantled.  We, civil society organizations, take seriously our responsibility regarding the wall.  We have engaged with the issue of the illegal building of the wall and will continue to do so in order to effect the implementation of all components of the Court’s opinion and the General Assembly resolutions on enforcement.

Our meeting here in Geneva, at this time, takes place in a critical and historical moment. We can either shut our eyes to the urgent crisis facing the Palestinian people and the obligations of the international community to end it, or we can seize this moment to push for a real movement forward in order to achieve a just peace.  We have decided to be part of those working towards creating a new reality, based on justice, human rights and international law – to end the occupation and realize the inalienable rights of the Palestinian people, including the right to self-determination and the right to establish an independent, sovereign Palestinian state with its capital in Jerusalem.  We thus make the following call:

Call to action

We call on the United Nations and its Member States:

1. To provide international protection for the Palestinian people living under occupation.

2. To bring to justice in the International Criminal Court, or in another international or national forum – based on universal jurisdiction, those guilty of war crimes against the Palestinian people.

3. To encourage and impose sanctions, especially in the form of ending the murderous arms trade with Israel, and to end sanctions that have been imposed against the elected Palestinian Authority and the collective punishment of the Palestinian people.

As for civil society, we commit ourselves to the following:

1. To work in the coming months with Palestinian civil society movements and nongovernmental organizations to mark the 40-year anniversary of the occupation of the Palestinian West Bank, Gaza Strip and East Jerusalem. That commemoration will include a wide range of education and cultural campaigns, all culminating in a Global Day of Action on 9 June 2007, the fortieth anniversary of that occupation, under the slogan “The world says no to Israeli occupation.”

2. To expand our global campaign of boycotts, divestment and sanctions (BDS) to ever broader sectors of our countries and regions, based on building a non-violent movement of opposition to Israeli apartheid and occupation, including an urgent campaign to end the sanctions against the democratically-elected Palestinian Authority.

3. To mobilize to demand that our Governments urgently provide international protection to the Palestinian people living under occupation, including efforts to bring to justice those guilty of war crimes against the Palestinian people.  We will also support efforts to enforce the Geneva Conventions and all United Nations’ resolutions, and to convene a new international peace conference for the Middle East with the United Nations at its centre.

The above-mentioned  report  A/61/355-S/2006/748 was  submitted by the Secretary-General  in accordance with General Assembly resolution 60/39 and covered the period from September 2005 through September 2006.  Section II of the report, which contains the observations of the Secretary-General on the current state of the Israeli-Palestinian conflict and on international efforts to move the peace process forward is reproduced below.

5.  As the current round of Israeli-Palestinian violence enters its seventh year, I regret that the opportunity for the revitalization of the Middle East peace process I had hoped for last year has not materialized. Violence has been on the rise during the reporting period and has included suicide bombings in Israel by Palestinian militants and indiscriminate rocket and mortar fire at Israel, as well as Israeli aerial strikes, extrajudicial killings of alleged militants, extensive ground operations and tank shelling.  There have also been worrying incidents of intra-Palestinian violence, primarily in the Gaza Strip.

6.    As I have said in the past, I deplore the killing of civilians, who too often have fallen victim to this violence because of a lack of adherence by the parties to their obligations under international law.

7.    Elections for the Palestinian Legislative Council were held on 25 January 2006 throughout Gaza and the West Bank, and included limited participation of Palestinian residents of East Jerusalem. At that time, I congratulated President Abbas and the Palestinian people on the peaceful and orderly conduct of the elections. The official results indicated that the Change and Reform list of Hamas had won a majority of seats. Subsequently, the Quartet indicated that it was inevitable that future assistance to any Palestinian government would be reviewed by donors against the commitment of that government to the principles of non-violence, recognition of the right of Israel to exist and acceptance of previous agreements and obligations, including the road map.

8.  President Abbas tasked Mr. Ismail Haniyeh of Hamas to form a government and urged him to align his government’s programme with that of the presidency.  In his inauguration speech, the Prime Minister stated his respect for the constitutional relationship with President Abbas and his respect for the role of the Palestine Liberation Organization. However, the government did not commit to the principles articulated by the Quartet.

9.   After the Israeli general election of 28 March 2006, a coalition government was formed, led by Prime Minister Ehud Olmert, which expressed its desire to set the permanent borders of Israel, preferably through an agreement with the Palestinians.  The Government acknowledged that this would entail a reduction of the number of Israeli settlements in the Occupied Palestinian Territories, but also envisaged the retention of major settlement blocs on occupied land. According to the Government’s guidelines, Israel would stand ready to proceed unilaterally should it judge that negotiations with the Palestinian side were not possible.

10.   On 10 May 2006, Palestinian prisoners in Israeli jails, including senior Fatah and Hamas figures, drafted a document that referred to common political goals aimed at establishing a Palestinian State within the 1967 borders and describing the Palestine Liberation Organization as the sole legitimate representative of the Palestinian people. Fatah and Hamas reached an agreement on 27 June 2006 on a revised version of this document and pledged to make it the basis for establishing a national unity government. Negotiations to form such a government are continuing, but have not borne fruit to date.

11.   On 25 June 2006, Palestinian militants attacked an Israeli military base near the Gaza border, killing three Israeli soldiers and capturing one. The Government of Israel subsequently launched a wide-ranging military operation in the Gaza Strip with the stated aims of freeing the soldier and putting a halt to rocket fire. The operation has included aerial bombardments, ground activities, the arrest of Palestinian cabinet ministers and lawmakers, and the destruction of civilian infrastructure, including the only electric power plant in Gaza, roads and bridges, as well as many other public and private installations. To date, over 200 Palestinians have been killed.

12. The United States Security Coordinators, Lieutenant General Ward (until November 2005) and his successor Lieutenant General Dayton, continued their work to push forward Palestinian security sector reform in order to control internal violence and make progress towards the fulfilment of Palestinian road map commitments. During the first months of the reporting period, the Palestinian security services exhibited a readiness to confront militants by conducting arrests or operations to confiscate explosive material. In November 2005, President Abbas established a leadership committee which tasked a technical team with drafting a white paper on safety and security. A first draft was produced in December 2005 with the support of the United States Security Coordinator.

13.   The result of the Palestinian legislative elections, however, was not without impact on the security sector. The Government of Israel put a stop to the transfer by the international community of equipment for the Palestinian security forces. Additionally, President Abbas and the government made conflicting security appointments and decisions. The Palestinian Minister of Interior deployed in Gaza a new “special force” drawing its members from existing security services and various factions in spite of President Abbas’ declaration that this move was illegal. Clashes ensued between security forces and calm was restored only after President Abbas and Prime Minister Haniyeh agreed to absorb the “special force” into the payroll of the Palestinian Authority. The United States Security Coordinator has continued to work with President Abbas in an effort to strengthen the Presidential Guard, and with the President’s office in a strategic advice capacity.

14.   The Government of Israel has failed to implement its obligations under the road map to freeze its settlement activities and dismantle outposts constructed in the West Bank since March 2001, although it carried out the evacuation of the Amona settlement outpost in February 2006. The construction of a police station in the E1 area between Jerusalem and the West Bank settlement of Ma’ale Adumim is under way, consistent with a plan to link Ma’ale Adumim to Israeli territory. In December 2005, it was reported that 3,696 housing units were under construction in West Bank settlements and another 1,654 in East Jerusalem. Further expansion of West Bank settlements to the north and south of Jerusalem and in the Jordan Valley were authorized by the Israel Ministry of Defence.

15.   The pace of construction of the barrier in the West Bank accelerated during the reporting period. Land expropriation orders were issued by the Government of Israel to allow the extension of the barrier around Jerusalem eastward so as to envelop the settlement of Ma’ale Adumim. The Israeli High Court of Justice rejected a petition against the construction of the barrier in northern Jerusalem, but ordered the dismantling of five kilometres of the barrier east of the settlement of Tzofim. The Israel Ministry of Defence reportedly ordered a review of the route of the barrier in order to reduce its impact on Palestinian daily life. The continuing construction of the barrier encroaching on Palestinian land contradicts the legal obligations of Israel set forth in the 9 July 2004 advisory opinion of the International Court of Justice and General Assembly resolution ES-10/15 of 20 July 2004. Further to this resolution, I have continued my efforts to establish a register of damage incurred by Palestinians due to the construction of the barrier.

16. Quartet Special Envoy James Wolfensohn has emphasized that without the re-establishment of free movement inside the West Bank, a viable Palestinian economy is not possible. For several months, he endeavoured to advance an agenda covering issues relating to movement and reform in the Occupied Palestinian Territories. On 15 November 2005, further to his efforts and to the personal engagement of United States Secretary of State Condoleezza Rice and European Union High Representative for Common Foreign and Security Policy Javier Solana, the Government of Israel and the Palestinian Authority reached an Agreement on Movement and Access. The Agreement included the opening of the Rafah crossing for travel of persons between the Gaza Strip and Egypt under the supervision of the European Union. Accordingly, the Rafah crossing initially operated on a daily basis, but since 25 June 2006, it has only been open sporadically. The Agreement also covered the continuous opening of crossings between Israel and Gaza for both goods and people. Again, and despite initial operation of the crossings, the Karni, Kerem Shalom and Erez crossings have not operated regularly throughout 2006. The frequent closure of the Karni commercial crossing has meant that few exports have been able to pass. Other aspects of the Agreement, such as the Israeli commitment to allow truck and bus convoys between Gaza and the West Bank and to reduce the number of movement obstacles in the West Bank have not been implemented. The Government of Israel has also not yet provided assurance that it would not interfere with the operation of the Gaza seaport, and there have been no discussions on the opening of the airport.

17.   Israeli security forces have increasingly divided the West Bank into three distinct areas, with movement relatively free inside those areas but severely hampered between them. According to the Office for the Coordination of Humanitarian Affairs, the Government of Israel has increased the number of physical obstacles in the West Bank by 43 per cent since the signing of the Agreement on Movement and Access. New Israeli measures in the Jordan Valley have prevented almost all Palestinian non-residents who do not work in the area from accessing it. Access has also been restricted to closed areas between the Green Line and the barrier.

18.   The Palestinian Authority was already facing serious political, financial and social difficulties at the end of 2005. While the international community praised aspects of the Palestinian Authority response during the disengagement process, the Authority’s performance in the months following disengagement was mixed. The wage bill continued to grow as the Authority recruited more officers into the security forces, security in Gaza deteriorated, and rocket attacks on Israel continued. By December 2005, key donors were reconsidering their support to the Palestinian Authority’s budget, which was already depleted.

19. After the Palestinian legislative elections in January 2006, the Government of Israel declared that the Palestinian Authority had turned effectively into a “terrorist entity” and decided to withhold the transfer of customs and value added tax payments that it collects on its behalf. This decision, which effectively deprived the Palestinian Authority of approximately US$ 50 million per month, is contrary to the provisions of the Paris Protocol. Key donor Governments also withdrew their direct support to the Authority in the light of the failure of the new Palestinian government to commit to the principles laid out by the Quartet. The ensuing contraction of economic activity reduced domestic tax revenues. These combined factors, further compounded by a crisis in the banking system, resulted in an acute fiscal crisis for the Palestinian Authority.

20.  As a result, the Palestinian Authority became increasingly unable to meet its financial obligations. It cut most social benefits in February 2006 and stopped paying salaries to civil servants as of March. By April 2006, it was estimated that its monthly revenue was a mere sixth of its requirement. Aware of the humanitarian consequences of the situation, and while stressing that the Palestinian Authority was not relieved of its responsibilities to assist the Palestinian people, the Quartet expressed on 9 May 2006 its willingness to endorse a temporary international mechanism, limited in scope and in duration and operating with full transparency and accountability, to ensure the direct delivery of assistance to the Palestinian people. The provision of fuel support costs and payment of allowances to health workers by the European Union under the mechanism began in July 2006. Other aspects, including payments of needs-based allowances and other non-salary costs, such as medicines, have also begun.

21.   Nearly one million Palestinians used to rely on a Palestinian Authority wage earner, and the salaries paid by the Authority used to account for about 25 per cent of gross domestic product. Additionally, recipients of Palestinian Authority salaries operate the health, education, security and other services for the Palestinian people. Economic surveys have pointed to dramatic rises in poverty and unemployment should the fiscal crisis continue, and have evidenced a 7 per cent decrease in the Palestinian gross domestic product in the first quarter of 2006. The destruction of civilian infrastructure during the Israeli military operation that was launched following the capture of an Israeli soldier near Gaza has resulted in electricity being cut in Gaza between 12 and 18 hours a day, the rationing of water and an increase in public health hazards. The frequent closures of the Karni crossing into Gaza have caused a serious depletion of stocks of basic food commodities and food rationing has been introduced.

22.  The Secretariat has continued to provide regular monthly briefings to the Security Council on the latest developments in the Middle East, as well as whenever the situation on the ground demanded that the members of the Council be kept urgently apprised.

23.  The Ad Hoc Liaison Committee met in London in December 2005 to discuss the economic, fiscal and humanitarian situation in the Occupied Palestinian Territories. The Quartet met in the margins of this meeting and expressed support for the Palestinian Authority’s efforts to prevent armed groups from acting against law and order. It continued its sustained efforts during the reporting period, having already met in September 2005, and again in January and May 2006, thus signalling its readiness to engage in the conflict and support efforts at implementing the road map. I have also remained committed to furthering the cause of peace in the Middle East and undertook a visit to the region in November 2005 and in August-September this year.

24. The United Nations agencies and programmes have continued to carry out their mandates to assist the Palestinian people. Donor support is more necessary than ever, and in July 2006, donors pledged to make significant contributions to the revised consolidated appeal of the United Nations for the Occupied Palestinian Territories, and notably to the United Nations Relief and Works Agency for Palestine Refugees in the Near East (UNRWA). In its statement of 9 May 2006, the Quartet called upon the international community to respond urgently to assistance requests by international organizations, especially United Nations agencies. I also urge all potential donors to reaffirm their support to UNRWA and to the consolidated appeal.

25. I remain disturbed over restrictions imposed by the Israeli security forces resulting from the construction of the West Bank barrier, as well as from checkpoints and other obstacles that have consistently impeded the ability of United Nations agencies and programmes to provide assistance to Palestinians. Increasingly tight restrictions have confronted movement of international staff to and from Gaza and movement of national staff has been more difficult between Jerusalem, where most United Nations offices are headquartered, and the West Bank, where aid is needed. The supply of humanitarian goods to the Gaza Strip through the Karni crossing has been difficult and significant costs have been incurred as a result of long delays in returning empty containers.

26. Of particular concern to me are incidents that have compromised the security of United Nations staff members. Some have occasionally been fired on at checkpoints. Demonstrations were held in front of United Nations offices in the Occupied Palestinian Territories, notably at the Gaza office of the United Nations Special Coordinator for the Middle East. On 30 July 2006, after a demonstration at United Nations premises in Beirut following the Israeli shelling of Qana during the conflict between Israel and Hezbollah, Palestinian militants participating in a demonstration entered the office and ransacked it, damaging valuable material. On 31 December 2005, a recreational facility operated by UNRWA in Gaza City was bombed by Palestinian militants. Fortunately, no staff member of the United Nations was hurt in either incident.

27.  It must be noted that the road map indicated the end of 2005 as the target date for settlement of the Israeli-Palestinian conflict. Though this deadline passed unobserved, the road map remains the agreed framework for achieving a just and lasting peace in the Middle East and is therefore an important reference for the future. I regret that prospects for achieving a two-State solution have not improved over the reporting period. While realities have changed, it is essential that all parties be encouraged to adopt policies and practices that are conducive to a peaceful solution. In this regard, I have welcomed the continued commitment of President Abbas to a platform of peace, and I have noted with satisfaction Prime Minister Olmert’s stated readiness to engage a Palestinian partner. I am also pleased that opinion polls have continued to emphasize the desire of both the Israeli and the Palestinian peoples for a negotiated two-State solution, even if confidence in the peace process is declining. While the negative developments in recent months are gravely distressing, they must not distract the international community from exerting all efforts to re-energize the Middle East peace process. I therefore wish to reiterate the central importance of negotiations between the Government of Israel and a Palestinian partner committed to the principles of the road map in order to achieve a two-State solution. The United Nations will continue to work towards the attainment of an independent, democratic and viable Palestinian State living side by side in peace and security with Israel, and of a broader regional framework for peace and stability, in keeping with Security Council resolutions 242 (1967), 338 (1973), 1397 (2002) and 1515 (2003), and in accordance with the road map and the Arab peace initiative.

28.   I should like to pay special tribute to Alvaro de Soto, United Nations Special Coordinator for the Middle East Peace Process and my Personal Representative to the Palestine Liberation Organization and the Palestinian Authority, to the staff of the Office of the United Nations Special Coordinator and to Commissioner-General Karen Koning AbuZayd of UNRWA, the staff of the Agency and all other United Nations agencies, who continue to provide dedicated and efficacious services while working under the most demanding, difficult and sometimes dangerous circumstances. I also wish to express my appreciation for the work of the Special Envoy of the Quartet, Mr. James Wolfensohn, who stepped down in April 2006, and whose contribution was essential.

IV.  QUARTET ISSUES STATEMENT

The following is the text of the Quartet statement that was issued after the meeting of the Quartet principals – representing the European Union, the Russian Federation, the United Nations and the United States of America – at United Nations Headquarters on 20 September 2006  (SG/2116).

Quartet principals –  Secretary-General Kofi Annan, Russian Foreign Minister Sergei Lavrov, Finnish Foreign Minister Erkki Tuomioja, United States Secretary of State Condoleezza Rice, High Representative for European Foreign and Security Policy Javier Solana and European Commissioner for External Relations Benita Ferrero-Waldner – met today in New York to discuss developments in the Middle East since their last meeting on 9 May 2006.

Taking stock of recent developments in the region, the Quartet stressed the urgent need to make progress towards a just, lasting and comprehensive peace in the Middle East.  The Quartet expressed its concern at the grave crisis in Gaza and the continued stalemate between Israel and the Palestinians.

The Quartet welcomed the efforts of Palestinian President Mahmoud Abbas to form a government of national unity, in the hope that the platform of such a government would reflect Quartet principles and allow for early engagement.

The Quartet underlined the urgent need for the parties to implement fully all aspects of the Agreement on Movement and Access.  Accordingly, Rafah and all other passages should remain open, consistent with relevant agreements.

The Quartet encouraged greater donor support to meet the needs of the Palestinian people, with a particular emphasis on security-sector reform, reconstruction of damaged infrastructure and economic development.  The Quartet commended the efforts of the World Bank and the European Union to facilitate needs-based assistance directly to the Palestinian people via the Temporary International Mechanism endorsed by the Quartet on 17 June 2006.  Mindful of the continuing needs of the Palestinian people, the Quartet endorsed the continuation and expansion of the Temporary International Mechanism for a three-month period, and agreed to again review the need for such a mechanism at the end of that period.

The Quartet noted that the resumption of transfers of tax and customs revenues collected by Israel on behalf of the Palestinian Authority would have a significant impact on the Palestinian economy.  The Quartet encouraged Israel and the Palestinian Authority to consider resumption of such transfers via the Temporary International Mechanism to improve the economic and humanitarian conditions in the West Bank and Gaza.

The Quartet welcomed the initiative of the Secretary-General of the United Nations to request James D. Wolfensohn to report on the situation on the ground.

The Quartet reaffirmed its commitment to the road map as the means to realize the goal of two democratic States – Israel and Palestine – living side by side in peace and security.  The Quartet stressed the need for a credible political process in order to make progress towards a two-State solution through dialogue and parallel implementation of obligations.  In this context, the Quartet welcomed the prospect of a meeting between Prime Minister Ehud Olmert and President Abbas in the near future.  The Quartet agreed to meet on a regular basis in the coming period at both the principal and envoy level, including with the parties and other regional partners, to monitor developments and actions taken by the parties and to discuss the way ahead.

In response to a letter dated 30 August 2006  from the Permanent Observer  of the League of Arab States to the President of the Security Council (S/2006/700), the Council convened on 21 September 2006 at the ministerial level  to consider the agenda item "The situation in the Middle East, including the Palestinian Question".  At the start of the meeting, the Secretary-General made a statement, which is reproduced below.  (For the verbatim record of the meeting see S/PV.5530).

Like no other conflict, the Arab-Israeli conflict carries a powerful symbolic and emotional charge for people throughout the world. The narratives of the two sides – dispossession, prolonged occupation and denial of statehood on one side, terrorism and existential threats on the other – stir the fears and passions of people of many nations. And our continued failure to resolve this conflict calls into question the legitimacy and the effectiveness of the Security Council itself.

The events of this summer have reminded us all how dangerous it is to leave the broader Arab-Israeli conflict unresolved and how interconnected the region’s problems are. At the same time, the role of the Security Council in bringing about the cessation of hostilities between Israel and Hezbollah and charting the way towards a sustainable ceasefire through resolution 1701 (2006) showed that it can play a vital role in the search for peace in the region. Resolution 1701 (2006) rightly stressed the need to achieve a comprehensive, just and lasting peace in the Middle East, based on all the Council’s earlier relevant resolutions. To do this, we must make progress on the issue at the heart of the conflict, which is the problem of Israel and Palestine.

Large majorities of both Israelis and Palestinians desire peace. What they desperately need is a bridge to enable them to reach peace from their present sad state of conflict. The bridge to peace must be wide enough to accommodate all who have a legitimate stake in the process, long enough to span the enormous gulf of mistrust that separates the parties and strong enough to withstand the efforts that will inevitably be made to sabotage it.

Yesterday, I stressed to my Quartet partners that the existing bridge to peace is badly in need of repair. Its foundations seem weak, since both parties have failed to take the concrete actions needed to meet their existing obligations. And the destination on the far side – an end to the occupation that began in 1967 and a secure Israel at peace with all its neighbours, including a new Palestinian State – remains distant, ill-defined and, for many, almost unimaginable.

Today we are dealing with a difficult situation in Gaza, where we see closures and a Palestinian Authority that is starved of resources. Palestinian schools, ministries and other institutions are now in sharp decline. Palestinian society is rapidly becoming poorer. If this were to continue and the Palestinian Authority were to collapse, the consequent fragmentation and radicalization of Palestinian society would be a terrible, perhaps irreversible, strategic setback.

Today, Palestinians in Gaza and in the West Bank living under occupation have neither a State nor a functioning government. Is it any wonder that they look to the international community for protection, for help and for hope? And if this is not forthcoming, the young people of Palestine will, sadly, be attracted by the false promises of those who advocate violence.

For their part, Israelis rightly demand an end to rocket attacks against the towns and kibbutzim of southern Israel, the return of the soldier captured on 25 June and a Palestinian Authority that accepts basic principles of peace and takes credible action to prevent attacks against Israel. Yet in the absence of a political process, which is the only way of bringing about lasting peace, Israelis naturally look to their own military to deal with security threats.

It would be easy for the international community to declare that the parties are not ready for dialogue and that until they are there is little that can be done. But that would be deeply disappointing. It would also be unfair to the parties themselves.

Poll after poll shows that people on both sides understand that there is no military solution to the conflict. These same polls show that people understand that a two-State solution cannot be achieved through unilateral actions by either side. I am convinced that both the Israeli Prime Minister, Mr. Olmert, and the Palestinian President, Mr. Abbas, understand these realities and are searching for a way forward. I send both of them my strong support, as the Quartet did yesterday.

The Quartet also encouraged efforts to form a Palestinian national unity government, in the hope that the programme of such a government will reflect Quartet principles and facilitate early engagement by the international community. President Abbas’ wisdom in pursuing this path must be recognized. So must the efforts of Palestinian Prime Minister Haniyeh.

During the meeting, I also reminded my Quartet partners that the Quartet itself must be more active and effective if confidence in the peace process is to be restored. I am glad to say the Quartet agreed that greater engagement is crucial – on the ground, with the parties and in the region.

But the test will be action. The parties must now rise to their responsibilities; so must the Quartet and our partners in the region; and so must the Security Council. With all the tools at our disposal, let us work together to put in place a credible political process based on dialogue, parallel implementation of obligations, monitoring of performance and clarity as to the end goal. The time has come to rebuild the shattered bridge to peace.

On 30 September 2006, the World Bank issued a report entitled: “Growth in West Bank and Gaza: opportunities and constraints” (report No. 36320-GZ, vol. I). The main findings of the report are excerpted below.

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Overall economic growth performance over the last fifteen years has been dismal, with high population growth outstripping the real gross domestic product (GDP) growth during most of this period.  Looking forward, economic prospects remain grim and highly dependent on political outcomes.  Israel’s withdrawal from the Gaza Strip in September 2005, while leaving political and economic prospects uncertain, had generated optimism about the attainability of a final status agreement based on the peaceful coexistence of two neighbouring sovereign entities.  The current political deadlock has significantly worsened the economic outlook.

In addition, there are signs indicating that the capacity of the Wet Bank and the Gaza Strip (WBG) to generate fast economic growth has been eroded, even if the closure regime becomes less oppressive: first, as its economy has been becoming more inward oriented, its industrial capacities have been depleted. On the demand side of the economy, consumption rather than exports of goods and services has been the key lever of growth of the West Bank and Gaza Strip economy. The role played by exports of labour, although – in the absence of investment inflows to WBG – a distorting one, has been vanishing with workers’ remittances from Israel falling due to Israeli security measures. Goods export performance has never been impressive.  Exports of labour appear to have crowded out those of goods and, together with aid inflows, erected barriers to industrialization through driving up the cost of labour and prices of nontradables that only investment inflows could help address.  But these were not forthcoming because of lack of security even in the 1990s.

Second, the economic recovery in 2003-2005 is not sustainable and reveals structural economic weaknesses.  The construction and agriculture sectors together with public administration have emerged as key levers of growth on the supply side of the economy.  Although manufacturing has also contributed to recovery, its share of GDP increased modestly and remained below its level in 1995, with competitiveness of the sector deteriorating throughout the decade (See chapters III and IV of the report). Recent growth was pulled by expansionary fiscal policy, banking credit to the economy, a relaxation of the closures regime and recovery in private consumption.  None of these recent trends is likely to continue over the period ahead.

Changes in West Bank and Gaza Strip exports and imports baskets reveal progressive de-industrialization of its economy, as both of them have moved to goods at lower levels of the technology ladder and imports of food products have largely crowded out investment goods.  The level of processing embodied in exports, as captured by the aggregate share of food products together with industrial raw materials, was always low, but have recently significantly declined. A shift in import demand towards lower processed goods and the fall in investment goods imports have accompanied the contraction in total imports, suggesting a further erosion of the industrial base.  Furthermore, many West Bank and Gaza Strip businesses have lost external markets due to uncertainty of their deliveries and growing trading costs -consequences of the closure regime.

Last but not least, as noted above, the Palestinian Authority is in the throes of a fiscal crisis, with large share of required adjustment falling on the expenditure side.  The room for manoeuvre is rather limited. Expenditures are not pro-growth but pro-social stability, with the public expenditures going almost solely to wages.  The falling governance capacity inevitably leads to deterioration in the business climate and discourages investments – placing further obstacles in the path to fiscal adjustment.

The challenge is to do away with impediments to economic recovery and growth, the most binding constraint of which is the uncertainty and extra cost of doing business because of the difficulty of access – not only to external markets but also to local markets – resulting from the Israeli security regime. The back-to-back system, mobile and fixed checkpoints and special security screenings of outbound and inbound shipments dramatically raise trading costs and fragment the WBG economic space, both in its internal and external dimensions. The current security regime eats away at the capacity for growth. It not only undercuts the competitiveness of existing businesses but also dramatically curtails the range of feasible investment opportunities in the West Bank and the Gaza Strip. In the absence of security measures, unfettered access to markets of such a highly developed economy as Israel would be a powerful magnet for domestic and foreign investments alike.

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