US embassy cable - 05TELAVIV922

C O N F I D E N T I A L SECTION 01 OF 02 TEL AVIV 000922 
 
SIPDIS 
 
E.O. 12958: DECL: 02/11/2015 
TAGS: ECON, KWBG, EAID, IS, SETTLEMENTS, GAZA DISENGAGEMENT, ISRAELI-PALESTINIAN AFFAIRS, ECONOMY AND FINANCE 
SUBJECT: PALTRADE OFFICER ON SETTLEMENT GREENHOUSES, PAPA 
PROGRAM 
 
 
Classified By: Economic Counselor Bill Weinsteinm for reasons 1.4 (b) a 
nd (d) 
 
1.  (C) Summary:  PalTrade cash crops officer Hashim 
Al-Hussaini spoke to Econoff February 9 on Gazan agribusiness 
and job creation post-disengagement.  On settlement assets, 
Hussaini emphasized the need for direct GOI-PA security 
coordination in order to safeguard greenhouses and other 
infrastructure during the pullout, arguing that 
Israeli-Palestinian dialogue on logistics such as third-party 
transfer or settlement inventory are less crucial at this 
juncture.  Hussaini was enthusiastic about USAID's 
Palestinian Agribusiness Partnership Assistance (PAPA) 
program, urging the USG to ignore what he called politically 
driven complaints of lack of prior USAID-PA coordination. 
Gazan firms had responded eagerly to the project, he said, 
which will create "thousand of jobs" and build agribusiness 
capacity in the long term.  He warned, however, that in order 
for Gazan agribusiness to succeed the USG must find a way to 
guarantee continued water supply to settlement greenhouses 
and to ensure market access for Gazan products regardless of 
the status of GOI closures.  End summary. 
 
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GOI-PA Coordination Needed on 
Safeguarding Assets During Transfer 
----------------------------------- 
 
2.  (C) Hashim Al-Hussaini, head of the Agribusiness Trade 
Development and Promotion Project of the Palestine Trade 
Center (PalTrade), told Econoff February 9 that unless the 
GOI and the PA coordinate closely on security issues 
surrounding the Israeli pullout, settlement assets will be 
"up for grabs" by armed factions, families with dubious 
claims to the land, or Gazan looters.  Hussaini said he is 
not certain whether the settlements should come under solely 
PA control, private ownership, or a mix of the two.  He 
expressed confidence, however, that as long as greenhouses 
and other agribusiness infrastructure remain intact and out 
of the hands of "renegades," Gazan firms will be able to put 
them to almost immediate use post-disengagement. 
 
3.  (C) "Israel knows who to talk to on settlements", he 
said.  "It's nave of them to say there's nobody."  Hussaini 
claimed he "knows for sure" that the PA has detailed plans 
for receiving and disposing of the settlement assets, and 
urged the GOI to turn immediately to Abu Mazen or Musa Arafat 
regarding "day of" security issues.  (Note and comment: 
Hussaini is reportedly related by marriage to Musa Arafat and 
may overstate his relevance on this issue.  Hussaini appeared 
unable to speak in detail about GOI-PA dialogue on 
non-security-related settlement asset issues, and declined to 
explain what steps must be taken to facilitate Gazan usage of 
the assets.  End note and comment.) 
 
--------------------------------------------- --- 
PAPA a Big Hit With Gazans Despite PA Complaints 
--------------------------------------------- --- 
 
4.  (C) In Hussaini's view, USAID's Palestinian Agribusiness 
Partnership Activity (PAPA) project is well-timed and has the 
potential to create "thousands of jobs" in the sector. 
"Forget the PA complaints" that USAID did not coordinate with 
Ministries on the project before issuing the tender, he said. 
 (Note: The Minister of Planning and the Minister for Cabinet 
Affairs separately raised their concerns with USAID.  Before 
putting the project out to bid, USAID had unsuccessfully 
tried to find a POC within the Ministry of Agriculture with 
whom to discuss the project.  End note.)  The Agriculture 
Ministry had also been angry at the NGO ACDI-VOCA for alleged 
lack of coordination with the PA on its U.S. Department of 
Agriculture-funded, small-scale Grants Management program, he 
said.  (Note: Hussaini may be reflecting the lack of 
information sharing in the Ministry of Agriculture, since a 
senior advisor to the PA Minister of Agriculture sits, along 
with ConGenOffs and USDA's Agricultural Specialist at Embassy 
Tel Aviv, on ACDI-VOCA's Food Security Committee -- the body 
which reviews all of ACDI-VOCA's USDA-funded small-grants 
proposals.  End note.)  In Hussaini's view, "conspiracy 
theorists" within the PA criticize any U.S.-affiliated 
project for political reasons. 
 
5.  (C) Gazan firms "jumped on" the PAPA tender, Hussaini 
explained.  PAPA will build long-term capacity in the 
agribusiness sector, he said, and "inspire" Gazan growers by 
giving them access to the top-of-the-line technology inside 
settlement greenhouses.  Moreover, PAPA is "back on the right 
track" -- a step towards long-range development assistance 
rather than purely emergency aid, which had been the donor's 
focus since the start of the Intifada. 
 
6.  (SBU) USAID notes that PAPA is designed to facilitate the 
transfer of existing agribusiness in the Gush Katif area and 
promote additional agribusiness development in Gaza following 
Israeli withdrawal by supporting the refurbishment of 
greenhouses, preventing the destruction of capital 
investment, and minimizing disruption of operations.  The 
greenhouses will be placed under the management of a 
Palestinian caretaker entity until they can be privatized. 
PAPA's operational focus is on Israeli-Palestinian 
agribusiness partnerships, which will enable the rapid 
transfer of processing technologies following disengagement, 
as well as ensure that Gazan growers have continued access to 
wider markets through Israel's existing trade links. 
 
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Water and Closures -- Two Main Obstacles 
on Settlement Assets 
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6.  (C) According to Hussaini, PAPA's potential shortfalls 
lie in water shortages as well as the GOI's closure regime. 
On water, the PA does not have sufficient resources to 
irrigate some 4,000 dunams of settlement greenhouses, let 
alone 18,000 dunams of fertile "security zone" land that 
surrounds the settlement blocs.  Hussaini argued that USAID 
must guarantee Israel's continued supply of water to the 
settlements, noting that the PA would "of course" pay a fee 
for this service.  On closures, he said, USAID must work with 
Israel to provide goods-to-market insurance.  "We can grow 
world-class produce, but it's worth nothing if we can't ship 
it out of Gaza."  Any job-creation initiative is welcome, he 
said but donors must first address closures. 
 
7.  (C) Hussaini's comments underscore the Gazan private 
sector's high hopes for the settlement assets, and their 
belief that greenhouses can provide extensive benefits to the 
Gazan economy post-disengagement.  The USG should continue to 
encourage direct GOI-PA dialogue on the logistics of transfer 
through clear and consistent channels. 
 
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