Iraq News Now

The Trump administration’s $50 billion Middle East economic

plan calls for creation of a global investment fund to lift the Palestinian and

neighboring Arab state economies, and construction of a $5 billion

transportation corridor to connect the West Bank and Gaza, according to US

officials and documents reviewed by Reuters.

The “economy first” approach toward reviving the moribund

Israeli-Palestinian peace process could be a hard sell to a largely skeptical region.

The plan, set to be presented by President Donald Trump’s son-in-law, Jared

Kushner, at an international conference in Bahrain next week, includes 179

infrastructure and business projects, according to the documents.

More than half of the $50 billion would be spent in the

economically troubled Palestinian territories over 10 years while the rest

would be split between Egypt, Lebanon and Jordan. Some of the projects would be

in Egypt’s Sinai peninsula, where investments could benefit Palestinians living

in adjacent Gaza, a crowded and impoverished coastal enclave.

The plan also proposes nearly a billion dollars to build up

the Palestinians’ tourism sector, a seemingly impractical notion for now given

the frequent flareups between Israeli forces and militants from Hamas-ruled

Gaza, and the tenuous security in the occupied West Bank.

The Trump administration hopes that other countries,

principally wealthy Gulf states, and private investors, would foot much of the

bill, Kushner told Reuters.

The unveiling of the economic blueprint follows two years of

deliberations and delays in rolling out a broader peace plan between Israelis

and Palestinians. The Palestinians, who are boycotting the event, have refused

to talk to the Trump administration since it recognized Jerusalem as the

Israeli capital in late 2017.

Kushner made clear in two interviews with Reuters that he

sees his detailed formula as a game-changer, despite the view of many Middle

East experts that he has little chance of success where decades of US-backed

peace efforts have failed.

“I laugh when they attack this as the ‘Deal of the

Century’,” Kushner said of Palestinian leaders who have dismissed his plan as

an attempt to buy off their aspirations for statehood. “This is going to be the

‘Opportunity of the Century’ if they have the courage to pursue it.”

Kushner said some Palestinian business executives have

confirmed their participation in the conference, but he declined to identify

them. The overwhelming majority of the Palestinian business community will not

attend, businessmen in the West Bank city of Ramallah told Reuters.

Several Gulf Arab states, including Saudi Arabia, will also

participate in the June 25-26 US-led gathering in Bahrain’s capital, Manama,

for Kushner’s rollout of the first phase of the Trump peace plan. Their

presence, some US officials say privately, appears intended in part to curry

favor with Trump as he takes a hard line against Iran, those countries’

regional arch-foe.

The White House said it decided against inviting the Israeli

government because the Palestinian Authority would not be there, making do

instead with a small Israeli business delegation.

POLITICAL DISPUTES REMAIN

There are strong doubts whether potential donor governments

would be willing to open their checkbooks anytime soon, as long as the thorny

political disputes at the heart of the decades-old Palestinian conflict remain

unresolved.

The 38-year-old Kushner – who like his father-in-law came to

government steeped in the world of New York real estate deal-making – seems to

be treating peacemaking in some ways like a business transaction, analysts and

former US officials say.

Palestinian officials reject the overall US-led peace effort

as heavily tilted in favor of Israel and likely to deny them a fully sovereign

state of their own.

Kushner’s attempt to decide economic priorities first while

initially sidestepping politics ignores the realities of the conflict, say many

experts.

“This is completely out of sequence because the

Israeli-Palestinian issue is primarily driven by historical wounds and

overlapping claims to land and sacred space,” said Aaron David Miller, a former

Middle East negotiator for Republican and Democratic administrations.

Kushner acknowledges that “you can’t push the economic plan

forward without resolving the political issues as well.” The administration, he

said, will “address that at a later time,” referring to the second stage of the

peace plan’s rollout now expected no earlier than November.

Kushner says his approach is aimed at laying out economic

incentives to show the Palestinians the potential for a prosperous future if

they return to the table to negotiate a peace deal.

White House officials have played down expectations for

Manama, which will put Kushner just across the Gulf from Iran at a time of

surging tensions between Tehran and Washington.

Kushner, for instance, is calling it a “Prosperity to Peace

workshop” instead of a conference, and a “vision” instead of an actual plan. He

stressed that governments would not be expected to make financial pledges on

the spot.

“It is a small victory that they are all showing up to

listen and partake. In the old days, the Palestinian leaders would have spoken

and nobody would have disobeyed,” he said.

TRAVEL CORRIDOR

Kushner’s proposed new investment fund for the Palestinians

and neighboring states would be administered by a “multilateral development

bank.” Global financial lenders including the International Monetary Fund and

World Bank plan to be present at the meeting.

A signature project would be to construct a travel corridor

for Palestinian use that would cross Israel to link the West Bank and Gaza. It

could include a highway and possibly a rail line. The narrowest distance

between the territories, whose populations have long been divided by Israeli

travel restrictions, is about 40 km (25 miles).

Kushner insists that if executed the plan would create a

million jobs in the West Bank and Gaza, reduce Palestinian poverty by half and

double the Palestinians’ GDP.

But most foreign investors will likely stay clear for the

moment, not only because of security and corruption concerns but also because

of the drag on the Palestinian economy from Israel’s West Bank occupation that

obstructs the flow of people, goods and services, experts say.

Kushner sees his economic approach as resembling the

Marshall Plan, which Washington introduced in 1948 to rebuild Western Europe

from the devastation of World War Two. Unlike the US-funded Marshall Plan,

however, the latest initiative would put much of the financial burden on other

countries.

Trump would “consider making a big investment in it” if

there is a good governance mechanism, Kushner said. But he was non-committal

about how much the president, who has often proved himself averse to foreign

aid, might contribute.

Economic programs have been tried before in the long line of

US-led peace efforts, only to fail for lack of political progress. Kushner’s

approach, however, may be the most detailed so far, presented in two pamphlets

of 40 and 96 pages each that are filled with financial tables and economic

projections.

In Manama, the yet-to-released political part of the plan

will not be up for discussion, Kushner said.

The economic documents offer no development projects in

predominantly Arab east Jerusalem, which Palestinians want as the capital of

their future state.

What Kushner hopes, however, is that the Saudis and other

Gulf delegates will like what they hear enough to urge Palestinian President

Mahmoud Abbas to consider the plan.

The message Kushner wants them to take to Ramallah: “We’d

like to see you go to the table and negotiate and try to make a deal to better

the lives of the Palestinian people.”

Palestinian officials fear that, even with all the

high-priced promises, Kushner’s economic formula is just a prelude to a

political plan that would jettison the two-state solution, the long-time

cornerstone of US and international peace efforts.