DPR Monthly Bulletin – Volume XXXVII, No . 02, CEIRPP, DPR Bulletin (February 2014) – DPR publication

February 2014

Volume XXXVII, Bulletin No. 2

Bulletin

on action by the United Nations system and

intergovernmental organizations

relevant to the question of Palestine

I.IMF ASSESSES TRENDS IN WEST BANK AND GAZA ECONOMY

A team of the International Monetary Fund led by Christoph Duenwald, the Mission Chief for the West Bank and Gaza, visited East Jerusalem and Ramallah from 28 January to 6 February 2014 to assess recent economic trends in the West Bank and Gaza and the financial situation of the Palestinian Government. Mr. Duenwald issued the following statement at the end of the mission (Press Release No. 14/44):

Economic activity in 2013 has been weaker than expected and fiscal strains have continued. We estimate that real GDP rose by just 1½ percent, reflecting the impact of uncertainty regarding the Israeli-Palestinian peace process and a sharp deterioration of economic conditions in Gaza. Owing to weak growth, the unemployment rate increased to 25 percent at end-2013. Despite increased donor assistance, the Palestinian Authority continued to accumulate arrears. At the same time, the Palestinian Authority reduced the outstanding stock of debt to commercial banks. The overall deficit, including development spending, is estimated at 13.7 percent of GDP, nearly 3 percentage points lower than in 2012, helped by improved revenue performance and some commendable efforts to contain spending.

The economic outlook for 2014 and beyond depends heavily on the outcome of the peace talks. Under the status quo, where peace talks are ongoing and their result is not yet known, we project growth of around 2½ percent this year, and similar subpar growth performance over the medium term, with rising unemployment.

A breakthrough in the peace talks could launch major donor initiatives, such as the Economic Initiative for Palestine, which could boost average annual real GDP growth to about 6½ percent in 2014-19. On the other hand, failure of the peace negotiations could trigger a political and security crisis that would lead to accelerated arrears accumulation and economic contraction, especially if donors signal scaling back their support.

The 2014 budget envisages modest further progress in fiscal consolidation but still leaves a sizable financing gap. Wage expenditure is budgeted to rise by nearly 5 percent. The budget envisages laudable reductions of untargeted fuel subsidies and rationalization of allowances, limits the rise in operating expenditures and transfers, and targets a reduction in net lending. Following recent practice, the wage bill is again based on zero net hiring. Domestic tax revenues are expected to increase by 6 percent, based on improvements in revenue administration.

Given the projected financing gap and substantial fiscal risks, including with regard to the wage bill, it is imperative to contain the 2014 budget deficit beyond the level envisaged in the budget. If not, accumulation of arrears will continue, thereby hurting the private sector and undermining the credibility of the Palestinian Authority. We recommend containing the overall increase in the wage bill to 2 percent (the same as last year), accelerating the reduction of poorly targeted fuel subsidies, and means testing and rationalization of transfers for recipients outside the cash transfer program. There is also scope to increase revenue by raising tax compliance through better enforcement and scaling back tax incentives. We recommend leaving corporate income tax rates unchanged to avoid revenue losses when revenue enhancing administrative measures have yet to take hold. Tax holidays should be eliminated urgently to avoid large foregone revenues in the event of successful peace negotiations that lead to increased inflow of foreign investments.

Structural reforms are critical to improve economic outcomes regardless of the results of the peace talks. If peace talks succeed, the Palestinian Authority would need to raise its implementation capacity through improved infrastructure and institutional reforms to optimize the economic impact of new financing and investment. The Economic Initiative for Palestine and other sources of support will present difficult economic management challenges, and cannot by themselves overcome persistent fiscal deficits and aid dependency. If peace talks do not succeed, the outlook could worsen and a new financing model — aimed at lower deficits and a change in the composition of spending in favour of development — would be urgently needed. In either case, support from the international community and broad-based and comprehensive easing of Israeli restrictions will be needed to underpin the Palestinian reform efforts.

II. UN SPECIAL COORDINATOR EXPRESSES CONCERN ABOUT DETERIORATING SITUATION IN GAZA

On the occasion of his visit to the Gaza Strip on 12 February 2014, the United Nations Special Coordinator for the Middle East Peace Process, Robert Serry, expressed his concern about the deteriorating situation in the territory. The following are excerpts from the press release:

“I am worried we are seeing more and more signs that the understanding on a ceasefire reached in November 2012 is eroding in both of its main requirements – the end of all hostilities and the opening of the crossings for people and goods”, Serry said. “During the past two months, we have seen more rockets being fired at Israel, border incidents, and Israeli retaliatory operations causing death or injury to civilians. The United Nations condemns the rise in violence, and all parties must act in accordance with international law.”

At the same time, social and economic conditions in Gaza are also deteriorating as a result of continued closures. In particular, imports of construction materials have dramatically decreased. “The closure of illegal tunnels has not been turned into an opportunity to increase the entry of construction material through legal crossings”, Serry noted. Even the United Nations construction work has suffered delays as a result of increased closures. Contrary to expectations, work on UN projects is still not back at the level that had already been approved by the Israeli authorities, and over 20 projects remain stalled since November 2013. “I sincerely hope that the Israeli authorities will fully adhere to their commitment to reopen Gaza for construction materials for UN projects”, the Special Coordinator said.

The recent decision to allow the entry of 1,000 tons of cement and other construction materials for flood relief is a positive step. Serry stressed that imports of construction materials for the private sector through legal crossings remain essential for the Gaza economy while material must not be diverted from its intended peaceful purposes. He also expressed hope that the Rafah crossing with Egypt would soon resume normal operations. Serry visited the Gaza City pediatric hospital, which has been affected by frequent power cuts due to the precarious energy situation in the Strip. “I was heartened to see that this children’s hospital is one of the facilities that benefit from the fuel emergency safety net created by the United Nations through the generous contributions of Turkey and the Islamic Development Bank, which is securing continuity of vital services. However, this is but a stop-gap measure, and more must be done to address Gaza’s chronic energy problems”, Serry remarked. “Energy is the basis for everything – whether desalination, private sector growth, or health services. Short-term solutions, such as the generous donation of Qatar to the Gaza power plant, remain essential. But we must also look to the medium term, and here we support the request of the Palestinian Authority to establish the so-called 161 power line from Israel into Gaza for better and more cost-efficient access to energy. Eventually, it is hoped an agreement is reached for the use of natural gas at the Gaza power plant itself.”

The Special Coordinator concluded: “Ultimately, only the reunification of Gaza and the West Bank under the legitimate Palestinian Authority, based on the PLO commitments, can pave the way to a durable solution for Gaza, as part of political progress towards peace.”

III. SECRETARY-GENERAL SUBMITS REPORT ON ISRAELI SETTLEMENTS

Pursuant to Human Rights Council resolution 22/26, Secretary-General Ban Ki-moon submitted a report to the 25th session of the Human Rights Council on 12 February 2014 on Israeli settlements in the Occupied Palestinian Territory, including East Jerusalem, and in the occupied Syrian Golan (A/HRC/25/38). Following are the conclusions and recommendations of the report:

49. Israeli settlement-related activities and settler violence are at the core of most of the violations of human rights in the Occupied Palestinian Territory, including East Jerusalem. By virtue of the interdependence of human rights, Israeli settlements and settler violence violate Palestinians’ economic, social, civil and political rights.

50. Israel, as the occupying Power, must abide by its international treaty and customary obligations by ensuring that the Palestinian population of the Occupied Palestinian Territory is afforded the protection provided for under international humanitarian law, and by respecting, protecting and fulfilling Palestinians’ rights so as to enable them to fully enjoy their rights under international human rights law.

51. Israel is obligated to comply with its commitments as set out in the Quartet road map, including by immediately ceasing the transfer of its population to the Occupied Palestinian Territory and by ending and reversing all settlement activity.

52. Israel should cease all settlement activity and exploitation of natural resources in the occupied Syrian Golan, implement relevant United Nations resolutions, including Security Council resolution 497 (1981), and withdraw from territories occupied in 1967.

53. It is incumbent on Israel to cease the violations of Palestinians’ human rights resulting from discriminatory and unlawful planning policies, laws and practices. Israel has to, in compliance with international law, amend the planning legislation and processes in order, in particular, to ensure the security of tenure and the full participation of Palestinians. Israel must also refrain from implementing evictions and demolition orders based on discriminatory and illegal planning policies, laws and practices.

54. Israel must, as a matter of urgency, enhance its efforts to combat settler violence in the West Bank, including East Jerusalem. It must take all necessary measures, including preventive measures, to protect Palestinians and their property, and to ensure that Palestinians have regular and unhindered access to their land, particularly, but not exclusively, in areas where the patterns of reported incidents show that Palestinians are especially vulnerable. Any law enforcement or protection measures must be carried out in a non-discriminatory manner.

55. Israel is obligated to ensure that all acts of violence committed by Israeli settlers against Palestinians and their property are investigated promptly, thoroughly, effectively, independently, impartially and in a non-discriminatory manner. Investigations should be subject to public scrutiny and allow for victims’ participation. Victims should be kept regularly and promptly informed of the progress and developments in investigations. Individuals who are responsible for violations should be prosecuted and victims should be provided with an effective remedy.

IV. USG FOR POLITICAL AFFAIRS BRIEFS SECURITY COUNCIL

On 25 February 2014, Under-Secretary-General for Political Affairs Jeffrey Feltman briefed the Security Council on the situation in the Middle East, including the Palestinian question. Following are excerpts from the briefing (S/PV.7118):

…

On the Middle East peace process, we are nearing a defining moment. United States Secretary of State Kerry’s months-long work to address Israeli and Palestinian aspirations and concerns in a fair and balanced manner has opened a credible political horizon for achieving a two-State solution. Any meaningful political initiative must continue to strive towards a comprehensive settlement, and it must address all final status issues in line with the principles outlined in the relevant Security Council resolutions, the Madrid principles — including land for peace — the road map and previous agreements between the parties.

International engagement, which is critical, remains strong. On 1 February in Munich, Quartet principals were briefed on progress in the negotiations. Secretary of State Kerry is continuing his consultations with the leaders over the United States framework proposal, which is meant to serve as a basis for continued negotiations, meeting with President Abbas in Paris on 19 February. We count on the continued support extended to those efforts by regional stakeholders, underlining the importance of the Arab Peace Initiative, which is the most viable way for attaining regional peace and yielding socioeconomic and security benefits for all peoples in the Middle East. As the Secretary-General told the Council last month, if the leaders are prepared to take the bold decisions required, he will also push ahead on the positive agenda of peace dividends for both sides.

Ultimately, any genuine intention to pursue peace requires strong leadership. Now is the time for domestic constituencies to put their agendas behind the peace agenda and for the leaders to reach out to their respective publics to raise awareness of the benefits of peace. For Palestinians, a negotiated peace settlement holds the promise of allowing it to become a fully recognized Member State of equal standing. For Israel, only a negotiated two-State solution will bring it the security and recognition it deserves in the region and beyond.

The situation on the ground remains fragile. In the West Bank, Israeli security forces carried out a total of 424 search and arrest operations. A total of 519 Palestinians were arrested, and 218 Palestinians were injured, including during demonstrations against the barrier. Two Israeli soldiers were also injured.

Clashes increased in and around Palestinian refugee camps, most notably in early February in the Al-Arroub and Al-Jalazoun camps, following the killing on 29 January of one Palestinian from the Al-Jalazoun camp near Ramallah and the Ofra settlement after allegedly opening fire at Israeli security forces. More than 30 Palestinian protesters were injured by Israeli live ammunition and rubber-coated metal bullets, while two Israeli soldiers were injured by stone- and Molotov cocktail-throwing.

Israeli security forces reported having foiled several terrorist attacks on Israel allegedly planned by individuals in the West Bank. That included the arrest of an alleged Al-Qaida cell on 22 January and the uncovering of several arms caches. Palestinian security forces, working to maintain order and security, safely defused some unexploded ordnance between 22 January and 3 February and arrested Hizb ut-Tahrir Islamic militants on 8 and 9 February.

Attacks by settlers on Palestinian property included damage to more than 3,000 trees and saplings and some 80 vehicles. On 6 February, three settlers were reportedly charged for setting fire to two vehicles and spray painting stars of David in the Palestinian village of Farata in November. During another attack, on 18 February, the tires of some 30 cars were slashed and anti-Arab graffiti was painted in the Sharafat neighbourhood of occupied East Jerusalem. The Israeli police reported the arrest in four operations of more than 10 settlers reportedly involved in attacks on Palestinians or their property. Palestinian stone- and Molotov-cocktail-throwing attacks — on the rise in recent months — resulted in three settlers injured.

The reporting period registered increased funding and incentives by the Israeli Government for existing settlements. Continued settlement activity, including in occupied East Jerusalem, is illegal and erodes hope for the two-State solution by undermining ongoing Israeli-Palestinian peace talks.

We are deeply concerned by the ongoing demolition of Palestinian residential and livelihood structures in Area C, particularly in the Jordan Valley and East Jerusalem. A total of 107 structures were demolished, leading to the displacement of 175 Palestinians. Those demolitions must stop and Palestinians must be given access to a fair and inclusive planning regime. We are also increasingly worried by reports of impeded access for the humanitarian community in the delivery of emergency shelter and other assistance. This month, the International Committee of the Red Cross decided to suspend its distribution of tents to people affected by house demolitions in the Jordan Valley, after noting a pattern of obstructions and confiscations of those items by Israeli authorities since the beginning of 2013.

We have reiterated our position on the continued practice of administrative detention by Israel, including of elected Palestinian Legislative Council members, and the six prisoners on hunger strike since January. Administrative detainees must be either charged or released. We are concerned about today’s report that a Palestinian prisoner died after he was transferred from an Israeli jail to the hospital. We will continue to follow the situation of Palestinian prisoners in Israeli detention closely.

Visits by Israeli groups, including senior officials, to the Temple Mount/Al-Haram Al-Sharif resulted in clashes between Palestinians and the Israeli police accompanying those groups. Incitement or provocations from any quarter must cease and the sanctity of holy sites of all faiths must be respected.

Turning to Gaza, there are troubling signs that the ceasefire understanding of November 2012 is eroding in both of its main requirements: the end of hostilities and the opening of the crossing for people and goods. In the past two months, we have seen more rockets being fired at Israel, border incidents and Israeli operations causing death or injury to civilians.

We condemn the increased rocket fire. This reporting period saw the firing of 44 rockets and mortars, of which 15 landed in Israel. Israel conducted six incursions and seven air strikes into Gaza, resulting in the death of two militants and injuries to 10 Palestinians. Israeli forces also reported dismantling an improvised explosive device on the border fence on 18 February. Palestinian activities and protests multiplied in the vicinity of the border fence and were met by increased Israeli live fire, resulting in two Palestinians shot dead and 16 injured. We are deeply concerned about that rise in violence and we call on all parties to act in accordance with international law.

Due to the ongoing closure of Gaza, the humanitarian situation continues to deteriorate. The United Nations Relief and Works Agency for Palestine Refugees in the Near East (UNRWA) urgently needs an additional $30 million to sustain critical emergency operations in Gaza, without which food aid will be cut back. We call on all donors, including those who have traditionally supported the Agency, to contribute to UNRWA’s emergency appeals.

The recent Israeli decision to allow the entry of 1,000 tons of cement and other construction materials for flood relief is positive. However, contrary to expectations, work on United Nations projects is still not back at the level originally agreed by the Israeli authorities, and more than 20 projects remain stalled since November 2013 due to lack of Israeli approval. We continue to call for the Israeli approval of all United Nations projects, and the resumption of already approved projects. We also call for a lifting of restrictions on exports and transfers of goods to the West Bank and Israel, and for permitting the import of construction materials for the private sector. We hope that the Rafah crossing with Egypt will soon resume normal operations.

Meanwhile, efforts to bridge the Palestinian divide continued. Fatah and Hamas delegations met in Gaza to discuss the implementation of existing reconciliation agreements, including the formation of a national consensus Government headed by President Abbas, and the organization of general elections. Ultimately, only the reunification of Gaza and the West Bank, under the legitimate Palestinian Authority, based on the commitments of the Palestine Liberation Organization, can pave the way for a durable solution for Gaza as part of political progress towards peace. Gaza, too, must reap the peace dividends of a negotiated two-State solution.

…

The ongoing hostilities in Syria also continue to impact the vulnerable community of Palestine refugees. The situation is deteriorating in Yarmouk, near Damascus, where 16,000 Palestine refugees remain trapped. While some assistance has reached those in need since 18 January, UNRWA continues to experience sporadic access. We call on all parties to grant UNRWA uninterrupted access to the civilian population of Yarmouk and other civilian areas.

On 10 and 18 February, explosions took place near UNRWA schools in Muzeirib, killing 18 people. We deplore those indiscriminate attacks and remind the warring parties of their obligations under international law to protect all civilians.

…

In conclusion, allow me to return to the Israeli-Palestinian peace talks. It is the United Nations sincere desire to see 2014 as the year that bears witness to a comprehensive settlement realizing the vision of two States for two peoples: Israel and Palestine, living side-by-side in peace, security and mutual recognition of each other’s legitimate rights, including self-determination, with each State ensuring equal civil rights for all its citizens. The Middle East region suffers from multiple crises and faultlines that require urgent attention, not least the conflict in Syria and its impact on neighbouring States. But the efforts deployed over the past seven months towards achieving a solution of the Palestinian-Israeli issue, in the form of a negotiated two-State solution, have come closer than at any point in recent time to making a real and much-needed contribution to regional stability. It is therefore in our collective interests, as well as that of both the Israelis and the Palestinians, to invest in the success of that process and ensure that it is credible and just for both parties.