Why is no one addressing the real reason for the weak Palestinian economy?

When a journalist was invited to a meeting, asked a question, and the distinguished speakers invoked their right to remain silent.

I never expected that Dr. Rajiv Shah, the administrator of United States Agency of International Development, would ignore my question completely, but he did. I thought he would make some general statement or perhaps say that the answer was too complex to be given in the short time available. But he chose to act as though the question had not been asked, as if I was not there.

In my opinion — which, of course, is not objective — the question was nothing but invited by the sign hanging behind him in the classroom at Tel Aviv University. Its headline read: “Transforming the Palestinian Economy.” Beneath it was written: “USAID through the Compete Project in the West Bank is strengthening the competitiveness and export potential of key sectors essential to the future prosperity of the Palestinian economy.”

I introduced my question by mentioning that only recently, a World Bank report calculated that the Palestinian economy was losing $3.4 billion per year — roughly 35 percent of its 2011 gross domestic product — due to Israeli control of 61 percent of the West Bank (Area C). My question was: Does USAID have the recipe on how to transform the Palestinian economy without 61 percent of the West Bank?

Dr. Shah, who accompanied U.S. Secretary of State John Kerry on his trip to Israel last week, had already met with Palestinian businesspeople in the West Bank. At Tel Aviv University he met with a class of several Palestinian entrepreneurs and managers, most of them young people, from the fields of IT and agriculture, who are taking a short, intensive course in management. The course is given in partnership with the university’s faculty of management and the Kellogg School of Management at Northwestern University in Chicago, and is funded by USAID.

A public-relations firm invited to this event several journalists who − how to say this delicately? − are evidently of my sort, i.e. are not invited to information-intensive background talks (or young ones with their professional futures still ahead of them). At first, I was undecided about attending, particularly since on that day I was in Area C of Bethlehem: in one Palestinian community without electricity (and so without Internet or computers), and with a history of home demolitions and prohibitions on construction; in another Palestinian community that has no electricity or running water, but does have home demolitions; and a third community that has running water and electricity, and also many demolition orders.

In the end, I decided that the anthropological experience was worth traveling the distance — the emotional distance, mostly — to Tel Aviv University’s verdant campus.

Several men wearing neckties ran hither and yon, in and out of the classroom, anticipating the arrival of the important guest and his entourage. Sometimes they checked something with the students who sat at long, curved tables, watching the bustle around them with what looked to me like remoteness and little interest. Some of them texted on their G2 iPhones. Israel does not allow Palestinian cellular companies the electromagnetic spectrum frequencies that are needed for G3.

Thirty-five minutes of the event went by with speeches about projects, creativity, the private sector, peace, the future, young people, challenges and meetings in the United States. The vice president of Tel Aviv University, Dr. Raanan Rein, said that the university was not leaving the peace process only to the politicians. Once, it had bilateral relationships with Palestinian universities, and now they are in need of a third party − foreign universities.

Dr. Shah spoke about the vision of economic development that accompanied Kerry’s diplomatic travels.

Then it was the students’ turn. Their questions were written out carefully in advance, in coordination with the people in charge of the project. When R. David Harden, the organization’s representative in the Gaza Strip and the West Bank, was asked what USAID was doing about helping Palestinian farmers gain access to water, he answered that USAID was working on efficiency in the water supply, that there is shortage of water and the Israelis have advanced technologies (read: desalination). In other words: It is none of our concern that Israel controls the water sources and is stealing the Palestinians’ water (80 percent of the water that comes from aquifers in the West Bank is allocated to Israel and Israelis, and the rest is left for the Indians).

“There is no time for journalists’ questions,” somebody said at the 39th minute. Tali Schneider, a more daring journalist than I, pointed out that journalists had been invited and promised that they would be able to ask questions. This encouraged me to say I also had questions. Schneider asked her two questions, and I followed suit and asked my two.

The first was addressed, as written above, to Dr. Shah, and the second to Prof. Rein, since he spoke so warmly about peacemaking: What has the university been doing about the right of students from Gaza to study in the West Bank (a right that Israel, as is well known, denies them).

Dr. Shah answered Schneider’s questions. Then the speakers got up and left.

The answer may be found in the silence, but also in the particulars of USAID’s Project Compete. “If the political climate remains stable, the Palestinian economy will have an excellent opportunity to integrate its trading capacity in world markets, leading to greater economic growth through trade.” How can the stability of the political climate be preserved? Nobody is addressing the main reason for the Palestinian economy’s weakness and the lack of competition — Israeli exploitation of the resources and Israeli-imposed restrictions, prohibitions and so on.

Here is what USAID is offering: the candy and the threat — if you do not stir the stagnant water (for example, by going to the United Nations or starting an uprising), we will deal with the efficiency issues and pamper individuals from the middle class so that they can adapt to the current stability: the Palestinians’ political idleness and the international collaboration with the destructive hyperactivity of the Israeli government.

Amira Hass, 10th November 2013,