US embassy cable - 05TELAVIV2647

C O N F I D E N T I A L SECTION 01 OF 03 TEL AVIV 002647 
 
SIPDIS 
 
E.O. 12958: DECL: 04/27/2015 
TAGS: ECON, SENV, ASEC, KWBG, IS, GAZA DISENGAGEMENT, HUMANITARIAN AID 
SUBJECT: TIME TO RESTART GAZA WATER PROJECTS? 
 
 
Classified By: Ambassador Daniel C. Kurtzer for Reasons 1.4 (b.d) 
 
1.  (U) This joint message from Embassy Tel Aviv and ConGen 
Jerusalem is an action message; please see paragraph 12. 
 
------------------- 
Summary and Comment 
------------------- 
 
2.  (C) Following the October 2003 roadside bombing that 
claimed the lives of three USG personnel in Gaza, we 
discontinued travel to Gaza by all personnel under chief of 
mission authority and suspended two large USAID-funded water 
projects in Gaza valued at over $120 million.  We now believe 
some positive developments on security, as well as 
the need to demonstrate support and strengthen PA President 
Mahmud Abbas before upcoming PA legislative elections 
planned for July, warrant rethinking the suspension of the 
water projects.  At the same time, we need to maintain 
maximum pressure on the PA to follow through on the Gaza 
bombing investigation, and ensure that any modification to 
our stance on the projects does not signal a weakening in our 
firm stance on the killings.  Accordingly, we propose a 
phased approach to restarting the projects.  End summary and 
comment. 
 
-------------------------------------------- 
Background on the Killings and the Decision 
------------------------------------------- 
 
3.  (C) In response to the October 2003 terrorist bombing 
that claimed the lives of three USG American personnel in 
Gaza, the USG decided to prohibit entry into the Gaza Strip 
by all personnel under chief of mission authority.  The 
deterioration of security in Gaza also led us to suspend two 
large-scale USAID-funded water projects that 
would have required USG or AmCit contract personnel to enter 
Gaza to monitor progress.  Other USAID projects that did not 
require the presence in Gaza of USG or Amcit contract 
personnel have continued. 
 
------------ 
The Projects 
------------ 
 
4.  (C) Each of the water projects is worth approximately USD 
60 million.  The desalination plant will have the 
capacity to produce 20 million cubic meters of potable, 
desalinated water -- enough to fulfill the drinking needs 
of up to 2/3 of the Gazan population.  The north-south water 
pipeline, which is designed to allow better 
allocation of water supplies throughout the length of the 
Gaza Strip, would deliver desalinated water, as well as 
water from other sources.  This ability to better allocate 
water supplied would greatly help relieve the pressure on 
Gaza's aquifer, which is already suffering from extensive 
salinization.  The benefits for the larger Gazan economy 
include the creation of hundreds of construction jobs during 
the next two to three years. 
 
---------------- 
Where We Are Now 
---------------- 
 
5.  (C) The USG has stressed to the PA that lack of progress 
on the Gaza investigation is a major issue in our 
relations.  The Secretary focused on it during her February 
visit, as has virtually every codel and senior USG 
visitor.  That lack of progress notwithstanding, PA officials 
have urged us to reconsider suspension of the 
water projects, because of their humanitarian impact. 
President Abbas made a personal commitment to the Secretary 
during her visit to follow up on the Gaza investigation. 
Embassy and ConGenOffs have since met with security 
officials tasked by Abbas to follow up on the case, but those 
contacts have yielded no progress to date.  Meanwhile, the PA 
has yet to establish its full authority in Gaza. 
 
6. (C) At the same time, there has been significant movement 
on cooperation in a number of areas between the 
Israelis and the Palestinians that augur well for the future. 
 On the security front, the period of calm, 
although shaky, remains in effect.  The GOI and PA are 
preparing in the next two weeks to convene committees to 
discuss the coordination of Israel's disengagement from Gaza 
and the northern West Bank.  During trilateral water 
talks this month, the parties took initial steps to start 
dialogue on Israeli settlement water infrastructure assets 
in Gaza that would be transferred during disengagement and on 
post-disengagement Gaza water supply and infrastructure 
issues.  These steps, which included the drafting of an 
agenda and agreement to develop a water-related work plan by 
mid-May, were taken with the explicit support of GOI and PA 
leadership. 
 
----------------------------------------- 
Reasons to Restart: Show Support for 
Abbas and Post-disengagement Gaza Economy 
----------------------------------------- 
7. (C) The most compelling argument for restarting the water 
projects is to show publicly visible support for a 
successful post-disengagement Gaza economy.  The slow pace of 
PA security reform and the chaotic security situation in 
Gaza have undermined Gazans, belief that disengagement truly 
offers them the opportunity for a new start.  Hamas 
has leveraged this sense of hopelessness to reap significant 
political benefits through its delivery of 
social services that compare favorably in the Gazan public 
mind with the lower-quality services provided by an 
ineffectual PA administration, widely viewed in Gaza as 
riddled with corruption.  With the July 17 parliamentary 
elections fast approaching, it is clear that the PA badly 
needs to deliver some concrete benefits to the people of 
Gaza.  The USAID projects' tangible investment in Gaza's 
infrastructure will be a visible sign to the people that 
the Israeli withdrawal offers future benefits and economic 
hope. 
 
--------------------------------------------- ---- 
Potential Pitfalls: Letting the PA "Off the Hook" 
--------------------------------------------- ---- 
 
8.  (C) There are strong arguments against restarting the 
water pipeline project.  In spite of intense USG efforts to 
convince the PA to bring the perpetrators of the murder of 
our colleagues to justice, there has been no progress to 
date in this effort.  Restarting water projects now 
inherently reduces the USG's leverage over the PA to 
resolve the case, and could also increase the danger to other 
USG personnel in the future.  Although the pipeline 
can be constructed without direct USG oversight, such 
oversight will eventually be necessary to oversee 
construction of associated pumping stations necessary to make 
the pipeline fully functional.  In a March meeting, a 
Palestinian Preventive Security Organization representative 
told LegAtt and RSO that he believed USG personnel would not 
be safe in Gaza until the murderers of the DynaCorps 
personnel were brought to justice.  As it is, the overall 
security situation in Gaza remains highly volatile, and 
President Abbas and Interior Minister Nasir Yusif have not 
yet been able to consolidate their control over the security 
forces, much less over those elements in Gaza who may have 
been responsible for the attack. 
 
----------------------------- 
Recommendation on Way Forward 
----------------------------- 
 
9.  (C) In spite of the valid concerns relating to restarting 
the water projects, we believe there is a way to move 
forward that can answer these concerns.  If we decide to 
restart work on the USAID projects, implementation should 
be designed to meet the twin goals of quick progress while 
maintaining leverage on the Gaza investigation.  USAID 
could restart the pipeline project -- the initial stages of 
which can be implemented without American direct-hires or 
American citizen contract personnel needing to do 
on-the-ground oversight -- while holding the desalination 
plant project in abeyance.  As the pipeline contract award to 
an American firm was merely suspended, USAID could quickly 
restart it, breaking ground and putting people to work by the 
end of June.  Once it starts, pipeline construction could 
lead to the employment of hundreds of local Gazan workers 
through Gazan companies. 
 
10.  (C) While the desalination plant will provide a 
much-needed independent potable water source for 
Palestinians, we propose to hold off on its construction 
until there is follow-through on the Gaza investigation. 
In addition, we note that its construction, unlike that of 
the north-south water carrier, will require AmCit personnel 
oversight presence from the start.  This, in turn, will 
require a much-improved overall security climate in Gaza. 
 
11.  (C) We will also need to devise a carefully balanced 
public diplomacy approach that highlights American generosity 
and helps Mahmoud Abbas along with a private approach that 
takes a firm look at the need for investigation progress 
before any other project is contemplated. 
 
12.  (C) Action Request.  Posts request Washington 
concurrence to restart immediately construction of the 
north-south water carrier. 
 
********************************************* ******************** 
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