US pushes Middle East economic plan, Palestinians reject it

Palestinians poured scorn on a $50 billion economic formula launched by the Trump administration for Israeli-Palestinian peace as the United States sought on Wednesday to win support for the plan as a foundation to ending the decades-old conflict.

Neither the Israeli nor Palestinian governments are attending the international meeting in Bahrain, orchestrated by U.S. President Donald Trump's senior adviser and son-in-law Jared Kushner.

The Palestinians and many other Arabs dismiss Kushner's plan as pointless without a political solution based on the creation of a Palestinian state alongside Israel.

Senior Palestine Liberation Organisation official Hanan Ashrawi said on Wednesday the Manama conference was " quite disingenuous".

"It is totally divorced from reality. The elephant in the room is the (Israeli) occupation itself," she told a news conference in the West Bank city of Ramallah.

Several thousand Palestinians demonstrated in the Gaza Strip and burned posters of Trump and Netanyahu. "No to the conference of treason, no to the conference of shame" read one banner.

The chief of Hamas, Ismail Haniyeh, criticised the plan as a ruse against the Palestinian people.

"This money must not come at the expense of our enduring rights, or at the expense of Jerusalem or the right of return or at the expense of sovereignty and resistance," he said.

U.S. allies Saudi Arabia and the United Arab Emirates discreetly support the plan, but several Arab states stayed away from the conference while others including Jordan and Egypt, the two Arab nations that have reached peace with Israel, sent deputy ministers.

The Lebanese government and parliament both oppose the U.S. plan, Prime Minister Saad al-Hariri said on Wednesday. [

The foreign minister of Bahrain, where the U.S. Fifth Fleet is based, said the plan was an "opportunity not to be missed".

He reiterated the need for a two-state solution, which has underpinned every peace plan for decades, but Trump's team has consistently refused to commit to it.

"I think if we take this matter seriously it could be a very important game-changer," Sheikh Khalid bin Ahmed al-Khalifa told Israeli public broadcaster Kan, in English.

Israeli Prime Minister Benjamin Netanyahu, a close Trump ally, has said Israel was open to the economic proposals.

The presence of Sunni Muslim Gulf states in Manama showed they want to encourage closer ties to Israelis - with whom they share a common foe in Shi'ite Iran - that have largely been under the table, said David Makovsky, a U.S.-based Middle East expert attending the event.

"(But) it's clear they won't bypass the Palestinians and do anything they don't want," he told Reuters.

The event is taking place amid high tensions between Tehran on the one hand and Washington and its Gulf allies on the other.

HARD SELL
Washington hopes wealthy Gulf states will bankroll the plan, which expects donor nations and investors to contribute $50 billion to Palestinian and neighbouring Arab state economies.

Saudi minister of state Mohammed Al-Sheikh told a panel that Kushner's plan was bolstered by inclusion of the private sector as a similar proposal, relying heavily on state funding, had been attempted during the Oslo interim peace deals of the 1990s that eventually collapsed.

But the "economy first" approach could be a hard sell as the political details of the plan, almost two years in the making, remain secret.

It is not clear whether the Trump team plans to abandon the two-state solution, which is backed by the United Nations and most countries.

Riyadh says any peace deal should be based on a Saudi-led Arab peace initiative that calls for a Palestinian state drawn along borders which predate Israel's capture of territory in the 1967 Middle East war, as well as a capital in East Jerusalem and refugees' right of return - points rejected by Israel.

Kushner has said the plan would not adhere to the Arab initiative.

Any solution must settle long-standing issues such as the status of Jerusalem, mutually agreed borders, Israel's security concerns, Palestinian demands for statehood, and the fate of Israel's settlements and military presence in territory where Palestinians want to build that state.

Palestinian leaders are refusing to engage with the White House, accusing it of pro-Israel bias. Breaking with the international consensus, Trump in 2017 recognised Jerusalem as Israel's capital, infuriating the Palestinians and other Arabs.

SOUND POLITICS
Former British Prime Minister Tony Blair also emphasised the need for a two-state solution and said peace requires both political and economic tracks.

"It's absolutely foolish to believe you can have economics without sound politics, but it's likewise completely futile to think politics will work without economics buttressing it," he told the gathering.

International Monetary Fund managing director, Christine Lagarde, said generating economic growth in conflict-riven countries can be a struggle.

The IMF puts unemployment at 30% in the West Bank and 50% in Gaza, which has suffered years of Israeli and Egyptian blockades and recent foreign aid cuts and sanctions by the Palestinian Authority, Hamas' rival in the Israeli-occupied West bank.

"Gaza right now is feeling a lot of pain because of bad leadership and the sanctions that have been imposed on them because of it," Kushner said. "So the question that (Hamas)leadership has to ask themselves is...do they hate their neighbour in Israel more than they love their citizens and their people?"

The 179 proposed infrastructure and business projects in the plan include a $5 billion transportation corridor to connect the West Bank and Gaza, which has been floated before and stalled for lack of underlying political or security agreements.

Palestinian businessman Ashraf Jabari, chairman of the Palestinian Business Network, told the gathering it is difficult to build an economy with a "siege and unstable situation".

"Frankly, we demand an independent Palestinian state on the territories occupied by Israel in 1967," said the businessman from Hebron who has co-founded a trade group to boost business between Palestinians and Israeli settlers.