US embassy cable - 05TELAVIV2537

C O N F I D E N T I A L SECTION 01 OF 02 TEL AVIV 002537 
 
SIPDIS 
 
E.O. 12958: DECL: 04/21/2015 
TAGS: ECON, PREL, SENV, IS, ECONOMY AND FINANCE 
SUBJECT: THE GOI'S ECONOMIC PLAN FOR THE NEGEV AND GALILEE 
 
REF: A. 04 TEL AVIV 02901 
     B. 04 TEL AVIV 03085 
     C. 04 TEL AVIV 03393 
 
Classified By: Charge d'Affaires Gene A. Cretz for reasons 1.4 (b) and 
(d) 
 
1. (C) SUMMARY:  Vice Premier Shimon Peres is leading the GOI 
effort to consolidate a series of public- and private-sector 
development initiatives for the Galilee and Negev regions, 
which the GOI will push forward in tandem with disengagement. 
 To date there remains no comprehensive planning document 
that outlines exactly what the GOI plans to do in either 
region, and Peres staffers indicated the same to Econoff. 
Peres has raised the issue of possible USG assistance for the 
development initiative, and Peres staffers told Econoffs that 
they hope Congress will include such assistance in a 
supplemental package in early autumn.  Other GOI officials 
have also raised the question of USG assistance with 
Washington.  To bolster this initiative, the GOI is also 
seeking worldwide Jewish philanthropic assistance as a 
supplement to the budgetary funds.  Peres and staffers have 
noted that "quality of life" in the two regions will improve 
in the form of improved roads, railway system, industrial 
zones, parks and other projects.  In the Negev, they claim, 
this economic initiative will address the "Bedouin problem" 
of rampant unemployment, high population growth, and 
substandard living conditions.  Israeli-Arab and NGO 
communities have raised serious concerns, however, that 
development in the northern or southern parts of Israel will 
further disenfranchise the Israeli-Arab minority (septel). 
They fear that USG support for the initiative will encourage 
a more rapid "takeover" of Israeli-Arab lands by the State of 
Israel or private Jewish citizens.  END SUMMARY. 
 
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Old Plans, New Ideas, Looking Towards Galilee and Negev 
--------------------------------------------- ---------- 
 
2. (C) "The desert provides us with the best opportunity to 
begin again," stated David Ben Gurion in his memoirs.  This 
vision to populate and use the country's vast desert regions 
as an economic springboard has surfaced many times within the 
corridors of the GOI.  Between 1948-51, the GOI created plans 
to shape land development for the first two decades after its 
independence.  Its main feature: population dispersal with 
the clear objective of filling in areas along threatened 
borders.  By the mid-1960's, the plan became outdated and 
much of Israel was no longer sparsely populated nor empty. 
The Negev Law passed in 1986 and the Galilee Law passed in 
1988 include steps to revive development of both these 
regions.  Ministries were tasked to work closely with the 
Galilee and Negev planning councils for appropriate 
allocation of resources for housing, financing of education, 
health, tourism, industry, transport, communications, 
absorption and immigration.  The Negev law was revoked in 
2002, but components of the law surfaced in independent plans 
that addressed small communal projects. 
 
3. (C) Beginning in 1990, massive immigration into Israel 
necessitated a plan to effectively address the population 
growth. This new plan was referred to as the "2020" plan. 
The Ministry of Interior, the Israel Lands Authority (ILA) 
and other organizations focused on creating a non-statutory 
master plan to serve as a framework for long-range policy in 
Israel.  The Negev portion of the 2020 plan focuses on civic 
and industrial growth in the southern region.  It includes 
plans for transportation projects, transfer of military 
bases, development of physical infrastructure such as roads 
and civil engineering projects, housing of Bedouin into 
permanent, recognized settlements, and developing the 
information technology sector.  Regional planning councils 
from the Galilee and the Negev work with the MoI and the ILA 
to coordinate projects. 
 
--------------------------------------- 
GOI Plan Big on Goals, Short on Details 
--------------------------------------- 
 
4. (C) Vice Premier Shimon Peres is working to consolidate a 
number of existing public- and private-sector initiatives for 
the Negev and Galilee regions, consolidating them into a 
"strategic development plan" that he says the GOI will strive 
to implement in tandem with disengagement.  Peres advisor, 
Einat Wilf told EconCouns April 14 that U.S. assistance for 
development of the Negev and Galilee was "put on the agenda" 
with AIPAC and Congress during Peres' recent visit to the 
U.S.  Peres put forward a figure of USD 250 million each year 
for four years, and the GOI hopes Congress will include the 
funds as part of a supplemental assistance package in early 
autumn.  The development plan, Wilf explained, will seek to 
mobilize additional funds from the Israeli budget and 
worldwide Jewish communities.  In a March meeting with A/S 
Welch and NSC director Abrams, Peres underlined one of the 
primary goals of Negev and Galilee development -- it will 
"provide a positive message to the Israeli people, to offset 
the negative message of disengagement." 
 
5. (C) Peres staffers explained that the plan will address 
"overall quality of life issues" in the Negev and Galilee by 
focusing on improved education, housing, and employment 
opportunities.  Staffer Uri Ben-Porath was not able to 
provide the details of these programs, however, explaining 
that the GOI hopes private investors will undertake the bulk 
of job-creation enterprises, including three planned 
high-tech parks throughout the Negev.  Large-scale public 
sector projects, including a rail line connecting Be'er Sheva 
with central Israel, and new Ministry of Defense training 
facilities, are also planned but not yet funded.  Ben-Porath 
emphasized that much of the GOI's direct involvement in the 
plan will center on the multi-ministry development initiative 
for the Bedouin community, which the Knesset approved in 2003 
with an NIS one billion allocation.  This initiative will aim 
to solve what Peres described to A/S Welch and NSC director 
Abrams as the "Bedouin problem" of high unemployment and high 
population growth, by relocating some 65,000 Bedouin 
currently living in unrecognized villages between Be'er Sheva 
and Dimona to GOI designated areas in the Negev region. 
Despite a proliferation of GOI offices and outside 
consultants tasked with planning and implementing Bedouin 
relocation -- including a field office in Be'er Sheva staffed 
by Amram Khalaji and several planning engineers -- Ben-Porath 
conceded that NIS one billion is "not sufficient to build 
even one new town."  "We will seek the rest of the money from 
other sources," he said, but could not specify whether the 
GOI expects USG assistance for this program. 
 
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