US embassy cable - 05TELAVIV3227

C O N F I D E N T I A L SECTION 01 OF 02 TEL AVIV 003227 
 
SIPDIS 
 
E.O. 12958: DECL: 05/26/2015 
TAGS: KWBG, EAID, ECON, IS, SETTLEMENTS, GAZA DISENGAGEMENT 
SUBJECT: GAZA DAIRY FARMER WANTS INTACT TRANSFER, DESCRIBE 
COMPLEX SETTLER MINDSET 
 
Classified By: Economic Counselor William Weinstein for reasons 1.4 (b) 
 and (d) 
 
1.  (C) Summary and comment:  Amidst halting progress on 
GOI-PA negotiations regarding the disposition of settlement 
assets, some settlement farmers are making independent 
attempts to secure the continuity of enterprises in which 
they have invested significant resources.  The CEO of Omer 
Cattle Marketing, the Gaza Strip,s only dairy farm, is 
seeking USG or European backing to transfer his business to 
the Palestinians in tandem with disengagement.  Omer,s Gush 
Katif owner/directors have forbidden management to seek a 
Palestinian buyer from among the company,s existing 
contacts.  Dani also discussed the status of settler 
preparations for withdrawal, quipping that while Katif 
residents are "no longer mowing their lawns," they have made 
no specific plans for their post-disengagement lives inside 
green line Israel.  In his view, settlers are beginning 
Spring planting not as an ideological gesture but a pragmatic 
commercial measure -- planting now will enable them to claim 
a force majeure exemption if disengagement prevents them from 
meeting contractual obligations to marketing firms.  Finally, 
Dani posited that settlers will willfully destroy greenhouse 
technology and other valuable agribusiness assets on the 
hectic "hour of" withdrawal, arguing that despite the IDF,s 
training of special disengagement units it will not be 
equipped to evacuate or safeguard machinery.  End summary. 
 
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Gaza's Dairy Farm Managers Prefer Intact Transfer 
With USG or European Assistance 
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2.  (C) While GOI and international attention has focused on 
the need to preserve settlement greenhouses following 
Israel's withdrawal from the Gaza Strip, policy planning has 
glossed over some settlement businesses that hold significant 
economic potential for the post-disengagement Gazan economy. 
Dani Ben Barak, CEO of Omer Cattle Marketing, which manages 
the Gaza Strip,s only dairy farm, told Econoff May 29 that 
he believes his business falls into this category, and said 
that intact transfer to the Palestinians is the only way to 
maintain the farm's value in the face of disengagement. 
Barak explained that, if evacuated, Omer,s several hundred 
head of cattle would have to be divided between several 
existing farms inside Israel, since the disengagement 
timeline offers no opportunity for the company to build a new 
facility elsewhere.  He explained that Omer,s Gush Katif 
owner/directors refuse to allow company management to seek a 
buyer from among interested Gazan agribusiness contacts. 
Only USG or European involvement, Barak said, will be 
sufficient to overcome this resistance, and enable what he 
termed "a boon to the Gazan economy and a significant 
national gesture for Israel."  (Note:  Omer does not 
currently meet USAID,s Palestinian Agribusiness Partnership 
Activity (PAPA) requirements for employment generation 
because it is primarily involved in R D and cattle import. 
It is connected, however, to the Israeli agricultural 
management firm CYC, which maintains farm facilities in 
several countries and could serve as a marketing link for 
increased Gazan exports.  End note.) 
 
3.  (C) Omer management envisions transferring the farm 
intact to the PA or a Gazan firm via a third party -- 
preferably a USG agency such as USAID or the Foreign 
Agricultural Service (FAS), a private U.S. firm, or a 
European entity such as the Dutch -- or, more simply, selling 
it directly to one of these outside entities.  Barak 
explained that the final owner, not the middleman, would pay 
Omer approximately 80 percent of the cost of opening a new 
facility inside Israel.  He pointed out that while management 
is willing to work with the Peres Center for Peace to 
potentially arrange for Dutch custodianship of the farm after 
withdrawal, this cooperation would also require USG 
assistance due to settlers' "longstanding distrust" of Peres. 
 When asked if Omer has approached the GOI with this agenda, 
Barak maintained that his company needs USG or European 
backing before the GOI will agree to support the plan "on a 
policy level."  Einat Wilf, advisor to Vice PM Shimon Peres, 
told EconCouns that she expects Omer, like the rest of the 
settlement agribusinesses, will accept GOI compensation for 
approximately 60 percent of the value of its farm and simply 
evacuate what it can, leaving the rest behind. 
 
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Gush Katif Settlers' Denial is a Front 
-------------------------------------- 
 
4.  (C) Barak described the current mood in Gush Katif as one 
of deliberate passivity.  "People have stopped mowing their 
lawns and cleaning their houses," he quipped, "but nobody is 
making plans" for their post-disengagement lives inside Green 
Line Israel.  In his view, settlers know in the back of their 
minds that they will be evacuated, but the political climate 
requires that they maintain a front of denial.  He said he 
believes that the settlement farmers have begun Spring 
planting not to send the message that disengagement will 
fail, as some Israeli media have reported, but to cover 
themselves legally when evacuation precludes them from 
meeting contractual obligations to marketing and retail 
firms.  "If they plant now, they can claim disengagement was 
a force majeure," Barak said. 
 
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Greenhouse Technology Will Be Destroyed or Left Behind 
--------------------------------------------- --------- 
 
5.  (C) Most of the USD 80 million worth of high-tech 
greenhouse machinery currently operating in Gush Katif will 
not leave the Gaza Strip, Barak claimed.  In many cases, he 
said, settlers will be focused solely on their families and 
personal belongings at "the hour of evacuation," and will not 
concern themselves with cumbersome pieces of technology that 
have no fixed destination inside Israel.  In other cases, 
settlers will destroy the machinery "out of spite" in the 
chaos of withdrawal.  The relatively few settlers that Barak 
expects will request the IDF to transport their greenhouse 
technology will be disappointed -- Barak asserted that 
despite highly publicized IDF preparations for disengagement, 
IDF soldiers will not be equipped to properly evacuate the 
machinery or protect it from settler vandalism. 
 
6.  (C) Comment: Barak's assertion that the GOI will not 
support intact transfer of the dairy farm unless it has U.S. 
or European backing is indicative of a murky political 
environment in which fraught settler-GOI relations and 
frequent impasses in GOI-PA technical coordination derail 
positive ground-level initiatives.  With disengagement 
quickly approaching, it appears that many potentially 
valuable economic assets will drop off the radar screen 
unless clear protocols for the transfer of assets are 
promptly put in place.  End comment. 
 
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