US embassy cable - 04TELAVIV1614

C O N F I D E N T I A L SECTION 01 OF 02 TEL AVIV 001614 
 
SIPDIS 
 
NEA FOR BURNS AND SATTERFIELD 
NSC FOR ABRAMS 
 
E.O. 12958: DECL: 03/15/2014 
TAGS: ECON, PBTS, IS, SETTLEMENTS, ISRAELI-PALESTINIAN AFFAIRS 
SUBJECT: HOUSING CONSTRUCTION IN WEST BANK/GAZA SETTLEMENTS 
INCREASES SUBSTANTIALLY IN 2003 
 
Classified By: DCM Richard LeBaron for Reasons 1.4 (B) and (D) 
 
1.  (SBU) Summary.  Newly released statistics indicate that 
housing starts in West Bank and Gaza settlements increased 
35% in 2003, in a year when total housing starts in Israel 
and the settlements dropped 8% compared to 2002 figures.  The 
great majority of the new housing appears to be within "the 
Jerusalem district," that includes settlements surrounding 
but not within the city's municipal border (examples are 
Ma'ale Adumim, Givat Ze'ev, and Beitar Illit.)  Housing 
starts in central West Bank settlements, however, also 
increased markedly.  A contact at the Ministry of 
Construction and Housing insisted that the increase did not 
reflect any new policy to build more housing in the 
settlements, but reflected decisions made in 2001 and 2002, 
when the planning process to build the new housing began. 
Building in the West Bank and Gaza Strip settlements 
accounted for 16% of all government-initiated housing 
construction in 2003, despite the area only accounting for 4 
percent of the Israeli population.  End summary. 
 
-------------------------------- 
CBS Statistics Show 35% Increase 
in Housing Starts in Territories 
-------------------------------- 
 
2.  (U)   Statistics released March 2 by the Central Bureau 
of Statistics indicated that housing starts (actual 
construction initiated) in West Bank and Gaza settlements 
jumped from 1,369 starts in 2002 to 1,849 starts in 2003, a 
35% increase.  The CBS statistics covered both public and 
private construction. The 35% jump compared to an 8% drop 
overall in housing starts in Israel and the settlements. 
Housing starts declined in every city or region in Israel 
surveyed, except Haifa (where housing starts grew 5%). 
Housing starts in the territories accounted for about 6% of 
total public and private housing starts in Israel and the 
settlements. 
 
                     2003 Housing      Percent Change 
City or Region       Starts            From 2002 
--------------       ------------      -------------- 
 
WB/G Settlements     1,849              35% 
Jerusalem            2,260             -15% 
Tel Aviv             2,725             -23% 
Haifa                3,238               5% 
South                4,568             -23% 
North                5,959             - 3% 
Center               9,074             - 6% 
Total               29,673             - 8% 
 
Source:  Israel Central Bureau of Statistics 
 
--------------------------------------------- ----- 
Ministry of Housing Statistics Show the Same Trend 
--------------------------------------------- ----- 
 
3.  (U)  Provisional Ministry of Construction and Housing 
data showed similar trends to the CBS statistics and provided 
more detail about where the housing is being built. 
MOCH-sponsored construction in the settlements increased 48% 
in 2003 over 2002 levels.  The great majority of that 
construction took place in areas of the West Bank within "the 
Jerusalem District" which includes settlements like Ma'ale 
Adumim and Beitar Illit but not settlements like Har Homa 
within the Jerusalem municipality.  Housing starts in the 
West Bank areas of the Jerusalem District increased from 717 
starts in 2002 to 1,034 starts in 2003.  Construction in the 
"central" area of the West Bank nearly doubled, from 55 
starts in 2002 to 107 in 2003.  Construction in settlements 
accounted for 16% of all MOCH-sponsored housing construction 
in 2003. 
 
                     2003 Housing Starts   Percent Change 
City or Region       Initiated by MOCH     From 2002 
--------------       -------------------   -------------- 
 
Settlements in 
Jerusalem District    1,034                   44% 
 
Settlements in 
Central District        107                   95% 
 
Total Israel and 
Territories           7,258                   -6% 
 
Source:  Ministry of Construction and Housing 
 
4.  (SBU)  Contacts at the Central Bureau of Statistics would 
not comment on the significance of the increase in housing 
starts in the territories, except to note the strong contrast 
with the overall drop in housing starts throughout Israel.  A 
contact at the Ministry of Construction and Housing insisted 
that the 2003 increase in settlement housing starts did not 
reflect any recent policy decision to increase housing in 
settlements.  He noted that the planning process for new 
housing typically takes well over one year.  The increase in 
housing starts in 2003, he said, reflected planning decisions 
made in 2001 and 2002. 
 
5.  (C) Comment:  Although the rise in housing starts in the 
territories may not reflect a recent government decision to 
prioritize housing in the settlements, it does reflect the 
GOI's decision not to enforce commitments it has made to 
freeze settlement activity.  Whether building decisions were 
made two years ago or the Ministry of Construction and 
Housing (led by vocal settlement proponent Effie Eitam) is 
pushing its own agenda, the simple fact is that new housing 
is being built in the settlements.  This is taking place 
despite a depressed housing market, significant existing 
vacancy rates, and a dangerous security environment.  End 
comment. 
 
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