US embassy cable - 05TELAVIV286

C O N F I D E N T I A L SECTION 01 OF 02 TEL AVIV 000286 
 
SIPDIS 
 
E.O. 12958: DECL: 01/14/2015 
TAGS: ECON, PREL, KWBG, IS, GAZA DISENGAGEMENT, SETTLEMENTS 
SUBJECT: BASSEY UPDATES ON DISENGAGEMENT LEGISLATION, 
NEGOTIATIONS WITH SETTLERS AND ASSET TRANSFERS 
 
 
Classified By: Economic Counselor William Weinstein for reasons 1.4 (b) 
 and (d). 
 
1.  (C) Summary.  Yonatan Bassey, director of the 
Disengagement Authority (SELA), provided Economic Counselor 
and Economic Officer on January 12 with updates on 
disengagement planning.  Bassey reported that the evacuation 
legislation should go to its third reading in the Knesset in 
late January or early February, and that compensation for the 
settlers may rise by 20 percent.  Bassey continued that more 
settlers are now coming to negotiate with SELA, either on 
their own or through lawyers, and that the GOI is prepared to 
help those who want to move as groups by establishing new 
moshavim for them to move to.  He also stressed the 
importance of pushing the Palestinian Authority (PA) to make 
a decision about how assets should be transferred, 
particularly greenhouses in the Gaza Strip.  While the the 
GOI is willing to leave any necessary equipment in the 
greenhouses, time may be running out to convince the settlers 
that this is beneficial to them.  End summary. 
 
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Status of Disengagement Legislation 
----------------------------------- 
 
2.  (C) Yonatan Bassey, director of the Disengagement 
Authority (SELA), told Economic Counselor and Economic 
Officer on January 12 that he expects the disengagement 
legislation to go to the Knesset for its third reading during 
the last week of January or the first week of February, and 
that his staff meets with the Knesset Finance Committee every 
day to discuss the law.  Bassey reported that compensation 
may rise by 20 percent because the GOI is under heavy 
pressure from the settlers and MKs to increase the amounts. 
He opined, however, that compensation should not be 
exaggerated because Palestinians will still fire Qassam 
rockets at Sderot and the GOI cannot be seen as compensating 
the settlers in excess while residents of this city and 
others remain underfire. 
 
3.  (C) In response to EconCouns's question, Bassey replied 
that there will be a separate budget for disengagement 
because the left is against the 2005 budget but for 
disengagement, while the right is for the 2005 budget but 
against disengagement.  Bassey said the 2005 budget should be 
approved by the end of February and the disengagement budget 
should be approved in March. 
 
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Settlers are "Coming Around" 
---------------------------- 
 
4.  (C) Bassey continued that he has been more optimistic 
about disengagement over the past two or three weeks since 
negotiations have been going well with the settlers.  He 
explained that the settlers' denial about eventual evacuation 
is dissipating, and as a result, more and more are coming to 
talk to SELA.  According to Bassey, many settlers have talked 
to SELA through their lawyers because they are afraid of 
being seen negotiating with the GOI by other settlers. 
Despite this, Bassey has met with about 20 groups of settlers 
who want to move together, which he explained was easier for 
him to work with, and said that he would have contracts 
signed with half of them by the end of the month.  He 
concluded that he wrote a letter to the settlers three months 
ago telling them to "wake up" and go talk to him so they 
could find a solution together, and that they were now coming 
around. 
 
5.  (C) For those settlers who want to move as a group, 
Bassey said the GOI would help by preparing two or three 
moshavim with temporary caravans for them to move to until 
their permanent houses are built.  He continued that some in 
the end may not choose to go to the moshavim at all, but that 
psychologically it would be better for them because they 
would be absorbed into their communities much faster.  He 
commented that a contract with the settlers from Ele Sinai 
who want to move together just south of Ashkelon is "90 
percent done." 
 
6.  (C) Bassey characterized the settlers from the Gaza Strip 
as 70 percent religious but of "many varieties" because they 
follow different rabbis.  He hoped that the rabbis would be 
able to convince the settlers to evacuate peacefully, but 
acknowledged that two settlements, Kfar Darom and Netzarim, 
"will not budge" and may be left to the end.  He 
characterized Netzarim as the eventual "Castle Netzarim" 
where most hold-outs will congregate.  Bassey explained that 
the other 30 percent of the Gaza Strip settlers moved there 
for a better life and are not "so fanatic." 
 
7.  (C) Moving on to compensation prepayments, Bassey opined 
they were not attractive enough to split in two or three 
tranches so most settlers would not leave early.  In 
addition, many settlers will have to wait for the end of the 
schoolyear -- which has been moved up from the end of June to 
the end of May for the Gaza Strip -- so even if their new 
homes are built, they will not go sooner.  Bassey concluded 
that June would be a big month for evacuation. 
 
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The Ball is in the PA's Court 
----------------------------- 
 
8.  (C) With respect to the Thai workers who are leaving the 
Gaza Strip, Bassey explained that they are only 10 percent of 
the manpower there and farms could continue to function with 
just Palestinian laborers.  He continued that the bigger 
problem is the transfer of the greenhouses after the 
evacuation.  He said he wants growers to leave the 
greenhouses intact -- with their equipment -- for the 
Palestinians in order to avoid a humanitarian disaster, but 
that the U.S. should push the Palestinian Authority (PA) to 
decide how it wants the assets transferred.  Bassey continued 
that this was not the GOI's problem, and that now that Abu 
Mazen has been elected, he needs to make a decision.  He said 
the GOI would be willing to compensate the settlers for 40 
percent of the value of the equipment if the PA decides it 
wants to keep it, and that the Ministry of Agriculture could 
train the Palestinians if needed. 
 
9.  (C) Bassey continued with a discussion of businesses in 
the Erez Industrial Zone, saying some would close altogether 
and others would relocate to Ashkelon or Sderot.  Most will 
close, however, because they will not be able to compete 
since their labor costs will be much higher in Israel. 
Bassey concluded that the businesses in Erez are a much 
smaller problem compared to the relocation of homes. 
 
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