US embassy cable - 04TELAVIV2353

C O N F I D E N T I A L SECTION 01 OF 02 TEL AVIV 002353 
 
SIPDIS 
 
NEA FOR BURNS/SATTERFIELD, USAID FOR ANE DMCLOUD, JKUNDER 
 
E.O. 12958: DECL: 04/22/2009 
TAGS: ECON, EAID, PGOV, KWBG, IS, GAZA DISENGAGEMENT, ISRAELI-PALESTINIAN AFFAIRS 
SUBJECT: ROLE OF WORLD BANK IN GAZA DISENGAGEMENT PLAN 
 
 
Classified By: Ambassador Daniel C. Kurtzer, Reasons 1.4 (B) and (D) 
 
THIS USAID CABLE HAS BEEN CLEARED WITH CONGEN JERUSALEM AND 
EMBASSY TEL AVIV 
 
1.  (C) Summary:  On Tuesday, April 20, USAID/West Bank and 
Gaza Director Garber and Deputy Director Ellis, met with 
Nigel Roberts, World Bank Country Director.  The meeting 
focused on the Bank's current thinking regarding Gaza 
disengagement and the Bank's specific plans for organizing an 
assessment mission to identify issues related to the 
disengagement.  End Summary. 
 
2.  (C) Nigel Roberts reported that PA Minister of Finance, 
Salam Fayyad, and Minister of Planning, Nabil Qassis, 
participated in the LACC meeting of April 20.  Unfortunately, 
security concerns precluded USG participation in this meeting 
and, coincidentally, the EC also did not have a 
representative present due to other engagements.  To Roberts' 
surprise Fayyad spoke about Gaza disengagement.  Salam began 
by noting the "unfortunate assurances given to Sharon" and 
commenting that "we have to wait until the dust settles,". 
He then stated that the PA has been thinking about Gaza/WB 
reconstruction issues and, in this context, views existing 
donor mechanisms as adequate, i.e., no need for, and a strong 
opposition to, new mechanisms to deal with Gaza disengagement 
considerations.  Further, he specifically noted that he saw 
no need for a separate fund for Gaza.  With regard to the 
role of the World Bank, Fayyad recommended that the Bank role 
should parallel that played in the early 1990's, and would be 
consistent with the Bank's official designation as the 
Secretariat of the AHLC.  He then indicated that the PA would 
 
SIPDIS 
welcome a World Bank analytical consideration of Gaza 
withdrawal, including what type of opportunities this would 
open, and that this effort should be treated not as a special 
exercise, but as part of an overall development plan. 
Roberts then indicated that he would be checking with Nabil 
Qassis and other PA officials to confirm whether the PA is 
ready for a World Bank assessment. 
 
3.  (C) Roberts advised USAID of his intention to grant an 
interview the next day to Ha'aretz newspaper in order to 
counter what the Bank, including Wolfensohn, fears is the 
wrong impression created by Israeli leaks regarding what the 
Bank has agreed to undertake in response to the Sharon 
disengagement plan.  The Bank is particularly concerned that 
the distorted reporting of World Bank intentions vis a vis 
the Gaza disengagement could undermine the Bank politically 
in the Middle East.  Specifically, he will state that the 
Bank is willing to play a constructive role at the behest of 
the relevant parties and that the Bank (and implicitly all 
donors) is committed to the continued viability of the PA 
(e.g., the about to be launched budget trust fund).  He said 
that he would further clarify that the Bank has agreed to 
play only a technical advisory role and not, repeat not, a 
custodial role with regard to the assets of evacuated 
settlements and that the Bank legally could not be the agent 
for compensation of settlers.  Lastly, he would note that 
Israel is not a Bank eligible borrowing country, and so 
expectations that the Bank might provide loans or guarantees 
for Negev development are misplaced. 
 
4.  (C) All the above said, the Bank is ready, with 
appropriate concurrence from the PA and the Europeans (who 
the Bank wants to make sure are on board since their ultimate 
financial support to any reconstruction plan would be 
crucial), to organize a six-person, ten-day mission to the 
region.  Roberts' current thinking is for an initial scoping 
mission during the May 6 through 16 period.  The team would 
focus on identifying issues that would need to be addressed 
by the parties and the donors before a comprehensive (or even 
preliminary) reconstruction plan could be prepared.  The 
assessment would cover such issues as the security regime, 
level of technical interaction between GOI and PA, transport 
and access issues that would facilitate economic development, 
etc.  The team also would visit the settlements from where 
Israel would withdraw, which could include the specified 
settlements in the northern West Bank, as well as in Gaza. 
In addition to meetings with relevant local actors, Roberts 
anticipates an interactive engagement between the team and 
the core donors.  Once the team completed this preliminary 
stage, then a decision would be made as to whether it makes 
sense to complete a more comprehensive reconstruction 
planning document. 
 
5.  (C) Roberts emphasized that the Bank does not want to be 
seen as being alone in responding to these developments. 
Clearly, even if they have lead responsibility on the 
preliminary assessment, they want this undertaken under a 
broader donor/political umbrella such as the AHLC or Quartet 
and with PA endorsement.  In this regard, he indicated US 
signals would be critical and commented that a US assistance 
pull-back from Gaza, whether over security or political 
considerations, would make the Bank's effort to create 
momentum very difficult.  (Note: The Bank is responsible for 
helping the Palestinians establish a Coastal Water Utility, 
which is a major complement to the USAID large infrastructure 
projects; they too have faced difficulties in awarding a 
tender, but have recently recommitted to moving their effort 
forward. End Note.) 
 
6.  (C) Lastly, Roberts noted that the Bank's plans are not 
widely known and requested that we not share beyond 
colleagues in the USG.  At the same time, he realized that, 
to field a team by May 6, he would require the necessary 
assurances by the middle of next week. 
 
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KURTZER