US embassy cable - 05TELAVIV1899

C O N F I D E N T I A L SECTION 01 OF 03 TEL AVIV 001899 
 
SIPDIS 
 
E.O. 12958: DECL: 03/24/2015 
TAGS: KWBG, OREP, PGOV, PREL, IS, GAZA DISENGAGEMENT, ISRAELI-PALESTINIAN AFFAIRS, GOI INTERNAL 
SUBJECT: VICE PRIME MINISTER SHIMON PERES CONSIDERS "THE 
DAY AFTER" WITH CODEL PELOSI 
 
Classified By: Ambassador Daniel C. Kurtzer for reasons 1.4 (b) and (d) 
. 
 
 1.  (C) Summary:  In a meeting on March 23, Codel Pelosi and 
Vice Prime Minister Shimon Peres discussed the political 
atmosphere surrounding Israel's disengagement from Gaza; the 
economic forecast for Gaza the "day after" disengagement; the 
steps that the international community can take to ensure a 
positive economic future for Gaza; the separation barrier and 
settlements in the West Bank; and current political 
developments in Lebanon and Syria.  End Summary. 
 
2.  (U) The delegation consisted of Representatives Nancy 
Pelosi, Henry Waxman, Darrell Issa, Linda Sanchez, Edward 
Markey, George Miller, Anna Eshoo, James McGovern, and 
congressional staff, and was accompanied by a poloff 
notetaker. 
 
------------- 
The Day After 
------------- 
 
3.  (C) Peres stated that the four-month period leading up to 
and completing Israel's disengagement from Gaza represents a 
unique political opportunity, but also brings to light the 
weaknesses in Israel's political system.  He noted that, 
unlike the bipartisan United States Congress, the Knesset is 
made up of members from 12 parties, many of which have split 
into factions themselves.  The parties that have supported 
disengagement have chosen to create a de facto coalition 
based on this one issue.  For some, the costs of such a 
coalition are high and the expectations low.  Peres 
emphasized that, faced with the threat of a referendum that 
could slow down or stop the process of disengagement, 
coalition members must mobilize their strength to get through 
the next four months without breaking.  He added that while 
the primary focus of this coalition must be disengagement, 
this is also a government of construction, building up the 
Negev and Galilee regions of Israel as it pulls out from 
Gaza. 
 
4.  (C) Peres stressed that, in the political struggles over 
disengagement, we cannot ignore the "day after" and must work 
to ensure the long-term success of the process.  The two main 
concerns remain how to achieve both security and a strong 
economy in Gaza.  According to Peres, Palestinian President 
Mahmoud Abbas is faced with the challenge of confronting 
groups such as Hamas and Islamic Jihad not only militarily 
but also with ballots, and the possibility exists that Hamas 
will score some victories in July's PLC elections.  Peres 
expressed Israel's surprise over the courage that Abbas has 
shown since his election in January, though he noted that 
Abbas still lacks the power and means to take all the actions 
and decisions necessary to achieve full security in Gaza. 
 
------------------------- 
Gaza's Economic Prospects 
------------------------- 
 
5.  (C) The security of Gaza and of Israel in the long run 
depends also on improving what Peres termed the "terrible" 
economic situation that exists in Gaza at present.  Peres 
noted that those Palestinians who still go hungry are not 
impressed by peace conferences.  The 1.5 million Palestinians 
in Gaza face economic woes that are immediate, while many of 
the solutions to these problems are slow to come.  Peres said 
he worries about the gap between the immediacy of the 
problems and the pace of the solutions.  In this gap, he said 
the possibility exists of Hamas gaining support in Gaza 
through its social and charitable services that deal with the 
immediate economic obstacles facing individuals and families. 
 
6.  (C) Peres called for addressing Gaza's economic 
afflictions up to and during disengagement as well as on "the 
day after," and finding solutions for immediate as well as 
long-term economic problems.  He proposed speeding up the 
movement of goods as one short-term solution, making the 
passage of goods to and from Gaza as swift as possible.  The 
World Bank has pledged $70 million of the $140 million 
required for this project, and Israel will provide the other 
half. 
 
7.  (C) Peres also suggested the creation of a social 
security program as another short-term economic boost for 
Gaza.  Such a program would provide $100 per month for 
100,000 families in Gaza.  The European Union, and Canada 
have pledged most of the $120 million needed for one year of 
such a program, which Peres contends will help alleviate 
poverty among Gazans in a tangible way.  Peres said he has 
also had conversations with the Indian special envoy to the 
region on further assistance.  Working out a way for Gazans 
to productively use the buildings in former Israeli 
settlements after disengagement would also help increase 
employment and economic opportunities in Gaza. 
 
------------------------ 
Gaza After Disengagement 
------------------------ 
 
8.  (C) Peres pointed to three methods of improving Gaza's 
economy after disengagement: the creation of industrial 
parks, such as those in Jordan; privatization; and building a 
tourist infrastructure.  Peres noted that Qualified 
Industrial Zones such as those built with the aid of Israel 
and the United States now produce $1 billion in exports and 
employ 40,000 people in Jordan, and he expressed hope that 
QIZs might also be in the future for Gaza and the West Bank. 
American companies have played an important role in Jordan, 
helping to modernize the country's educational system.  Peres 
envisioned U.S. companies building branches in the West Bank 
and Gaza and achieving similar "remarkable" results. 
American companies could also become the backbone of Gaza's 
tourism industry, and officials have already approached the 
American hotel chains Radisson and Starwood with ideas for 
creating tourism in Gaza. 
9. (C) When asked whether unilateral withdrawal from Gaza is 
helpful in achieving peace in the long term, Peres remarked 
that unilateral disengagement was not his first choice.  In a 
perfect world, he said, it should have been a negotiated, 
bilateral withdrawal.  Highlighting the Labor party's 
minority status in the Knesset, Peres said he preferred a 
mediocre step in the right direction backed by a majority 
over a grand idea with no support or hope of implementation. 
Some of the great mistakes of the past, such as Israeli 
settlement building and Palestinian terrorism, were 
unilateral.  Hopefully, Peres said, when these unilateral 
mistakes are rectified unilaterally, the two sides can forget 
the past and come together. 
 
------------------------------------ 
Settlements and the Security Barrier 
------------------------------------ 
 
10. (C) Addressing the question of whether Israeli 
settlements and the security barrier make a Palestinian state 
impossible, Peres stated that the security barrier was 
originally intended as a method of ensuring security for 
Israeli citizens.  The process of building the barrier 
whetted some political appetites for more land, but the 
barrier has since moved closer and closer to the Green Line. 
At present, the intended course of the barrier will leave 
only 5.5 percent of the West Bank on the Israeli side, more 
or less equivalent to the amount discussed in President 
Clinton's proposal at Camp David in 2000.  A Palestinian 
state is not dependent on whether or not there is a wall, 
Peres chided, but whether or not there is democracy. 
Palestinians have never governed themselves, and the 
Palestinian state will be their first experience in true 
governance. 
 
11. (C) As for the settlements, Peres dismissed estimates of 
up to 200,000 Israeli settlers living in the West Bank, 
stating that this number most likely includes Israelis in 
Jerusalem and that, at most, there are 60,000 settlers in the 
West Bank.  Eventually, islands of Israeli settlements will 
remain, taking only 3-4 percent of land in the West Bank. 
 
----------------- 
Regional Security 
----------------- 
 
12.  (C) Asked about the sustainability of economic 
relationships built within the region, Peres took the 
opportunity to put the Israeli-Palestinian conflict within 
the context of what he termed the larger conflict between 
Islam and the West.  While terrorists protest against 
modernization, he said, they have no message of their own. 
However, a wind of change can be seen in Muslim countries 
such as Turkey that have embraced modernity, in Jordan and 
Egypt, with their slow but sure political reforms, and in 
Syria, which now faces powerful demonstrations in Lebanon and 
warnings from the United States and other nations that Syria 
understands are not empty threats. 
 
13. (C) At this point, Peres stated, Syria is no longer a 
military consideration because the Syrian economy does not 
permit the country to buy modern weaponry, and the Lebanese 
have begun to ask why Syria is still in Lebanon.  Syria has 
taken advantage of its military presence for the economic 
exploitation of Lebanon.  If Lebanon can rid itself of Syria 
and Hezbollah, it can become an independent, tolerant 
democracy and society.  If not, it will become a Shiite 
state. 
 
14. (C) Codel Pelosi did not have an opportunity to clear 
this cable. 
 
********************************************* ******************** 
Visit Embassy Tel Aviv's Classified Website: 
http://www.state.sgov.gov/p/nea/telaviv 
 
You can also access this site through the State Department's 
Classified SIPRNET website. 
********************************************* ******************** 
KURTZER