US embassy cable - 05TELAVIV2722

C O N F I D E N T I A L SECTION 01 OF 03 TEL AVIV 002722 
 
SIPDIS 
 
E.O. 12958: DECL: 04/27/2015 
TAGS: KWBG, PREL, ECON, PGOV, EAID, IS, GAZA DISENGAGEMENT 
SUBJECT: PERES DESCRIBES POSITIVE CHANGE IN QURAYA'S 
ATTITUDE ON DISENGAGEMENT COORDINATION 
 
Classified By: DCM Gene A. Cretz for Reasons 1.4 (B) and (D). 
 
1. (C) SUMMARY: Vice Premier Peres told A/S Welch and Charge 
April 27 that Palestinian PM Quraya', in an April 21 meeting 
with Peres, showed a positive change of attitude toward 
disengagement coordination.  Peres said he cautioned Quraya' 
not to push for final status talks after disengagement; doing 
so could give the GOI an excuse not to move forward on the 
roadmap, which Peres termed the only "end game" and the best 
document possible for the PA.  Peres called Israeli criticism 
of President Abbas's performance "exaggerated," arguing that 
Abbas has made no significant mistakes in trying to manage 
the broken system he inherited.  He said the GOI should do 
more to help Abbas, e.g., by releasing more than the 400 
remaining prisoners that it committed to release, and 
"talking about" removing every remaining checkpoint and 
roadblock in the territories.  On economic development in the 
territories, Peres said he urged Quraya' to try to establish 
QIZes, and to develop beach resorts in Gaza.  He called for 
developing greenhouses on 25,000 dunams of Gaza land in 
addition to the 4,000 or so on which settlers have already 
built them.  He said the PA now appears more open to letting 
an intermediary, who Peres suggested should be the Dutch, act 
as a transitional caretaker for greenhouses.  Peres said he 
is urging DefMin Mofaz to do more to open passages and remove 
checkpoints, although he expressed understanding for the 
security and budget constraints facing Mofaz.  Peres said he 
would ask Quartet envoy Wolfensohn to help find financing for 
a rail link between Gaza and Ashdod to help facilitate cargo 
traffic in and out of Gaza while the Gaza sea port is 
developed.  On Galilee/Negev development, Peres said the GOI 
is seeking U.S. financial support because time is short for 
creating jobs and infrastructure in these regions.  END 
SUMMARY. 
 
-------------------- 
Meeting with Quraya' 
-------------------- 
 
2. (C) In comments about his April 21 meeting with PA Prime 
Minister Quraya', Vice Premier Shimon Peres told A/S David 
Welch and Charge April 27 that he had seen a clear, positive 
change in Quraya's, and the PA's, attitude about coordinating 
aspects of disengagement with the GOI.  He speculated that 
Quraya' might have moved toward a more accommodating position 
because disengagement coordination provides him opportunities 
to improve his cooperation with President Abbas and to exert 
leadership over leading PA figures such as Muhammad Dahlan 
and Sa'eb Erekat.  Quraya' might also see in disengagement 
coordination, Peres said, an opportunity for the PA to prove 
that it can deliver something.  He said that he and Quraya' 
had agreed to continue regular consultations, supported by 
joint working groups that the two established. 
 
3. (C) Peres recounted that he cautioned Quraya' about trying 
to jump ahead to final status issues upon completion of 
disengagement.  He said he told Quraya' that the roadmap, not 
a leap to final status, represents the "end game."  The 
roadmap is the best document that the Palestinians are bound 
to receive.  With the roadmap, the Palestinians enjoy support 
from the whole world.  Should the PA try to jump ahead to 
final status talks, the issues of Jerusalem and refugees, 
neither of which can be solved in the short run, would come 
to the fore.  Peres said he therefore advised Quraya' to 
forget about final status issues for now, not least because 
PA insistence on jumping ahead to them would give the GOI an 
excuse not to move forward on the roadmap. 
 
4. (C) Peres said he also stressed to Quraya' the importance 
of PA action against terrorism for establishing the 
conditions for continued progress after disengagement.  A 
failure to act against terrorism would undermine U.S. 
sympathy for Palestinian needs.  Peres said he told Quraya', 
"You have an open court in the United States.  Use it.  You 
may not have it forever." 
 
----------------------------- 
Assessing Abbas's Performance 
----------------------------- 
 
5. (C) Peres expressed concern about a divergence between 
current Palestinian/Arab expectations in the peace process 
and Israeli "worries."  Perhaps both sides, he said, are 
guilty of overstating their positions.  Preventing the 
divergence from widening is essential. 
 
6. (C) Peres called criticism of President Abbas's 
performance in the Israeli media "exaggerated."  No other PA 
figure could do better, he said, adding that he did not 
believe that Abbas has made any important mistakes.  Rather, 
he said he thought Abbas is struggling with a broken system 
not of his creation, and without a real army. 
 
7. (C) Welch commented that Abbas, despite his possible 
inability so far to deliver security performance on the 
ground, still benefits from a period of confidence in his 
leadership that happens to coincide with the run-up to 
disengagement.  He noted that he had asked DefMin Mofaz the 
previous week what the GOI could do to strengthen Abbas's 
position.  Mofaz had replied that the GOI could not do more 
that it has already given GOI perceptions of PA inaction on 
security, particularly with regard to fugitives.  He asked 
Pers whether this GOI position is sustainable. 
 
8. (C) Peres replied that the GOI needs to be more 
forthcoming.  First, it must take the risk of releasing 
Palestinian prisoners, both the remaining 400 it committed 
already to release, and more after them.  Second, the GOI has 
to begin talking about how to remove every remaining 
roadblock and checkpoint within the West Bank and Gaza. 
These impediments to free movement have both an important 
economic and "psychological" cost, he said.  Third, the 
United States should press Abbas to reorganize the PA 
security forces, not only for fighting against terrorism, but 
also against internal chaos within Palestinian society. 
 
9. (C) Welch responded that the U.S. has already done much 
through the Ward mission to advance PA security reform.  He 
noted that PA leaders have been telling U.S. officials that 
they need more lethal equipment to do their job, but Mofaz 
takes the position that the PA security forces lack only 
assertiveness, not equipment.  The equipment could, however, 
help build security force confidence, Welch commented. 
 
 
-------------------------- 
Economic Development in PA 
-------------------------- 
 
10. (C) Peres said he stressed to Quraya' that Israel has an 
interest in seeing Gaza overcome its poverty.  He held out 
Jordan, with its Qualified Industrial Zones (QIZes) as an 
economic model of "quiet success" for the Palestinians.  The 
PA, he said he told Quraya', should try to establish a QIZ 
and focus clearly on its target export markets.  Israel would 
be undoubtedly remain a target export market for agricultural 
and other goods.  Peres said he also advised Quraya' to 
exploit the resort potential of Gaza beaches.  Israeli Arabs 
-- 300,000 of whom already vacation in Jordan each year -- 
and West Bank Palestinians would be likely visitors to Gaza 
resorts. 
 
11. (C) Peres identified one of the key economic priorities 
in Gaza during the run-up to disengagement as the handover 
and development of greenhouses.  Up to 30,000 dunams (about 
7,500 acres) of Gaza land could potentially be dedicated, he 
said, for greenhouses, each of which can employ 45 
Palestinians.  (Note: Peres did not say how many greenhouses 
per dunam he was calculating.  About 9,000 Palestinians are 
currently employed in Gaza settlement greenhouses.)  Of the 
30,000 dunams, about 4,000 to 4,500 dumans of land already 
have settler-built greenhouses.  Most employees in these 
greenhouses are Palestinians.  The Peres center is willing to 
help build greenhouses on another 10,000 dunams.  An 
additional 15,000 dunams is also available for greenhouse 
development, he claimed. 
 
12. (C) The key greenhouse problem connected to 
disengagement, Peres continued, is ensuring that greenhouses 
already in place remain intact.  He suggested as a 
transitional measure using an intermediary caretaker, who, he 
proposed, could be the Netherlands.  The GONL, he said, is 
already providing financial support to the Peres Center for 
an agricultural marketing program in Gaza, and the 
Palestinians, for the first time, appear inclined to agree to 
a transitional arrangement with a third party.  Peres said he 
is discussing this proposal with the Dutch, although he noted 
his general frustration in dealing with Europeans, who almost 
never, he said, live up to their pledges of support.  He 
recounted that he complained in his recent meeting with 
President Chirac that France pledged $60 million for the 
Palestinians, but never delivered.  Chirac said he would make 
sure the money is transferred.  Peres acknowledged that it is 
not his job to represent Palestinian interests, but lamented 
that the PA does not do enough for itself. 
 
13. (C) Another key immediate issue Peres identified, both 
for the West Bank and Gaza, is passages.  He expressed regret 
that passages into and out of the territories are "not open 
enough" and that too many roadblocks within the territories 
still exist.  He said he raises the issue regularly with 
DefMin Mofaz, who, he commented, appears "to have his heart 
in it" but is constrained by security threats and a shortage 
of budget resources.  One key problem to resolve at all the 
passages, including the prospective Gaza sea port, is the 
inspection regime.  Given a PA desire to remain within the 
Israeli customs envelope, Israeli inspectors would have to 
serve both a security and economic function. 
 
14. (C) Peres said he reminded Quraya' in their April 21 
meeting that the GOI had agreed to open a sea port, but not 
an airport, at the February Sharm al-Sheikh summit.  Given 
that the sea port will take about three years to build, Peres 
said he urged Quraya' to focus on rebuilding the rail link 
between Gaza and Ashdod, which would cost, he said, only NIS 
60 million.  He said he would raise the issue of financing 
the project with Quartet envoy Wolfensohn. 
 
15. (C) Welch asked Peres whether the sort of progress he 
envisages at the passage points would be possible on the 
Gaza-Egypt border if the IDF remains in the Philadelphi 
Strip.  Peres said the IDF must withdraw from Philadelphi, 
although it needs help from Egypt to do so.  He characterized 
GOE performance so far in negotiations over the deployment of 
its border guards to the Gaza border as "one step forward, 
two steps back."  In any case, he said, another passage 
point, perhaps at Rafiah or Nitzana, should be opened. 
 
------------------------- 
Galilee/Negev Development 
------------------------- 
 
16. (C) Peres said the GOI would not normally ask the U.S. 
for financial assistance in developing the Galilee and Negev 
regions, but is doing so because time for these projects is 
now short, given the imperative of relocating settlers.  U.S. 
assistance is needed for job creation and infrastructure.  He 
praised Israeli settlers, "even though we may not like them," 
as young, devoted "pioneers" who "did their job" in the West 
Bank and Gaza, even though the settlement enterprise turned 
out to be "a waste."  He called them one of four waves of 
pioneering spirit in Israeli history, the others being the 
early members of the kibbutzim and moshavim, the founders of 
the IDF, and the developers of Israel's high-tech industry. 
 
17. (U) A/S Welch cleared this message. 
 
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