Ad Hoc Liaison Committee  - New York

Honorable Chairman, Norway's Envoy for the Middle East Peace Process,
Ambassador Tor Wennesland;
Finance Minister, Palestinian Authority,
Honorable Shukri Bishara,
Representatives of the World Bank, the IMF, UNSCO and the Office of the Quartet
Distinguished Delegates, Members of the Ad Hoc Liaison Committee,
Good morning,

It is my great honor to stand here today in front of this all important forum. I would like to take this opportunity to thank the Norwegian Government for their tireless efforts and ongoing work towards the convening of this AHLC meeting.

Naturally, I wish to thank the donor countries as well, for their steady support to the development and viability of the Palestinian economy, especially nowadays, when the ever shifting sands of the Middle East are reaching the doorstep of Europe, and posing new and additional financial and political challenges.

Israel believes that this joint effort for creating economic growth and effective governance practices, so needed for the sustainability of the Palestinian Authority, carries also the vision for a better and prosperous future for both parties, as well as for the neighboring countries and the international community alike. Hence, the economic development of the Palestinian people is first and foremost, an Israeli interest, and Israel works tirelessly to achieve this endeavor.

Therefore, it should be noted that Israeli introduced measures, suggested projects and packaged steps for the  improvement of the economic situation and standard of living of the Palestinian people, are an ongoing continues effort, involving feasibility studies and research over lengthy periods of time, and not just a bi-annual effort, towards this meeting.

Since our last meeting in Brussels, less than five months ago, Israel continued to take all possible measures to assist in creating a conducive environment for enhanced economic activity, hoping to encourage the resumption of direct political negotiations as well, that will lead, eventually, to the realization of the vision of two states living securely in peace, side by side. At the present time, when some radical extremists are stampeding on nation states, while others are trying to challenge the rule of law by horrific reprehensible acts of violence, such a progress in the Palestinian-Israeli relations will be a strong stabilizing massage, which will reflect on our entire region.

Mr. Chairman,

Israel aspires for peace. The Government of Israel is ready to work with all those in the region, and outside it, who are committed to enhancing the security, co-existence and welfare for all peoples in the region, and identify the opportunities within the challenges in a changing and profoundly volatile Middle East.

Prime Minister Netanyahu's message with this regard is loud and clear – as was reiterated during his recent visit to London, while meeting with Prime Minister Cameron.  In his message, Prime Minister Netanyahu expressed Israel's wish to have   a peace that would end the conflict once and for all. He emphasized that his position has not changed and that he supports the vision of two states for two peoples – a demilitarized Palestinian state that recognizes the Jewish state.

Indeed, over the last few weeks, some concrete and bold tangible steps were taken by Israel to benefit the Palestinian population. These steps are expected to create real change in the Palestinian economy and quality of life of the ordinary Palestinian.

But while taking these steps, Israel is also taking risks that should be perceived as security and confidence building measures. Some of the steps and measures we are introducing today are even contradicting Israel's fundamental concept of disengagement from Gaza, as they manufacture long term interdependency and exchange of strategic goods, such as energy.
 
Understanding how crucial is connecting Gaza to a reliable energy resource – crucial for its economy, industry, livelihood, and water sector: be it through access to potable water generated in a substantial desalination plant or adequate sanitation installations – and while taking in consideration its population's natural growth and foreseen future needs, the Israeli Government has authorized the connection of Gaza to a natural gas pipeline, as well as expressed its support of the development of the Gaza-Marine gas field.

Some initial contacts have been already made with potential donors towards the realization of this project, which will project on the life of every individual in Gaza.  Israeli private sector willingness to be a party to this project should be perceived as a trust and confidence building measure, especially on the backdrop of Palestinian Authority accumulated debt of 1.7 Billion Shekels to the Israeli Electrical Corporation that, alas, still keeps growing every month.

We trust that once the project is realized and operative, the International community will support the Palestinian Authority in taking all necessary measures – technical, financial, administrative, legislative – to ensure adequate payment collection and transfer of funds for the service.

Indeed, Israel is committed to work together with the Palestinian Authority towards building a strong and viable economy. At times of political tension, the importance of the practical, day to day, dialogues are even greater.  Practical dialogues are being held at various levels, advancing common goals and suggesting solutions for challenges on the ground.

Thus, Israel is pleased with the resumption of the Israeli-Palestinian dialogue within the MoF to MoF forum, which is the dialogue between the Ministries of Finance of the two parties, which was established in 2011 between Israel and the PA to promote various economic issues. Between June 2013 and September 2015, more than 30 bilateral Israel-PA meetings and over 40 Israeli inter-governmental meetings have been held, including a meeting headed by Palestinian Minister of Finance and the former Director General of the Israeli Finance Ministry on May 2015, and a ministerial level meeting on August 2015 with the New Israeli Minister of Finance,  Moshe Kahlon. That is emphasizing the new cabinet's commitment to the continuation of the dialogue.

The parties are currently discussing the implementation of a new mechanism that will better facilitate the movement of goods between Israel and the Palestinian Authority, and will support efforts by both sides to reduce illegal trade and tax evasion. The arrangements are expected to promote enhancement of the Palestinian tax system, thereby strengthening the economic base of the Palestinian Authority.
These days, there are three main bilateral teams working on the implementation of the suggested arrangements, dealing with the new clearance mechanism, storage facilities in the PA; and petroleum pipelines. These three teams report to the MoF to MoF forum, alongside additional issues that are being raised in the forum and in direct channels between the parties.

One of the most urgent issues still topping the two Ministries of Finance's agenda is the need to resolve the Palestinian Electricity debt of 1.7 billion New Israeli Shekels to Israeli Electricity Corporation.  Recently progress has been made in the matter, yet unsatisfactorily. And as long as the PA continues to consume electricity, it places a growing heavy financial burden upon the Israeli Electrical Corporation and upon the Israeli consumer, which effectively subsidizes electricity consumption in the PA.
The government of Israel and the Israeli Electric Corporation are looking forward to reach a fair and sustainable solution to the debt problem, which will ensure the uninterrupted supply of electricity to the Palestinian Authority, as well as strengthening the PA's budjet.

As part of Israel's commitment on transferring collection of clearance revenues, in the first 9 months of 2015 Israel has transferred to the Palestinian Authority over 5.1 billion Shekels of the collection of clearance revenues. Israel continues to transfer revenues to the Palestinian Authority at the beginning of every month in spite of the ongoing unilateral political policy taken by it.  Actually, as a good will gesture, for Eid al-adha Israel has already transferred over 530 million NIS for September clearances

Direct bilateral dialogue between Israel and the Palestinian Authority has been proven fruitful as advancement can be registered also in the JTC- Joint Technical Committee on communication, were the two parties have achieved agreement on frequency allocation for third generation mobile communication principles, which can also become a platform for 4th generation technology in the future.
Good will has been demonstrated also on the postal Joint Technical Committee, which resumed its meetings on September and is looking into the issues of direct postal exchange and collection and transfer of terminal dues.

Israel does its utmost, within the current circumstances, to bring positive change and improvement of the living conditions of the Palestinian people, in both Judea and Samaria and Gaza. Targeting the reduction of unemployment in the West Bank, Israel has increased the quota on entry of merchants by 1300, from 18,700 to 20,000, and is about to issue additional one thousand working permits for West Bank Palestinian workers, to be employed in industry, services and technical sectors at the Atarot industrial zone.

Furthermore, Israel continues to promote new income generating projects and welcomes international role in the development of industrial zones in the West bank such as those in Hebron, Jerico and Jenin, and facilitates their development. These projects will create thousands of new jobs and introduce Palestinian products to international markets.

Another recently authorized measure to be introduced by Israel in order to ease and optimize trade for West Bank, which will also supply additional employment opportunities, is the door to door mechanism of merchandise entry from Ashdod Port, using Palestinian trucks being driven by Palestinian drivers.

Acknowledging the needs for community housing and infrastructure development in area C, Israel authorized the continuation of planning procedures for 19 master plans for the Palestinian sector in Area C, and would like to take this opportunity and announce on 13 additional master plans that have been approved in principal, and will be promoted now through the planning committee for further development.
With this regard, we would like to take this opportunity and emphasize to the relevant stakeholders the importance of following the lawful administrative procedures regarding licensing and permitting in the context of planning and zoning in Area C, so to enable sustainability of infrastructure.

I would like to congratulate the Palestinian and other Muslim delegates for Eid al-Adha.  The recently celebrated holyday provided another opportunity for good will gesture by the Government of Israel as it forwarded an advance on October collected tax revenues, normally due to be paid by November.
In this context, Israel took civilian steps for the benefit of the Palestinian population during the month of Ramadan and Eid al-Adha which included:

During Ramadan: Providing almost 300,000 special Ramadan permits throughout the holiday, including "Id-al Fiter" holiday family visits, quota-free; Offering quota of 20,000 permits for Mid-week prayers on the Temple Mount;  Friday prayers on the Temple Mount access for over 270,000 women without a permit or age limitation; Issuing Permits for men for Friday prayers on the Temple Mount ; Approving 650 visitation licenses for holiday visits; Removal of security indication for 119 operatives of the PA security forces; 1511 Crossings of minors below the age of 12 without a permit; Crossing of VIPs and their family members via Israeli crossings without security check and others.

During Eid al-Adha: Issuing special permits throughout the holiday for family visitation in Israel for married couples, and members of the PA security apparatus and their families with no age limit; Issuing 250 permits for members of the PA security apparatus with security indication and their spouses to visit family in Israel; Prayer on the Temple Mount for 20,000 visitors; Issuing 550 permits for traveling abroad via Ben-Gurion Airport and Authorizing VIP  families to travel abroad via Ben-Gurion, no quota; Issuing 500 visitation licenses for a period of 30 days; Issuing 250 new residency permits to members of the PA security apparatus and their relatives from Gaza, as well as changing 250 addresses.

Additionally, operation hours of both the Reihan and Gilboa Crossings into Israel were extended, as well as those of several gates. Moreover, operating hours of Gilboa, Ephraim, and Tarkumia crossings for cargo movement were extended two weeks prior to the holiday and door to door entrance of food and animals was authorized. Furthermore, organized shuttles of 500 Gazans in each of the two days of the Eid – altogether 1000 people – were allowed to the Temple Mount and return of 28 Palestinian fishing boats by the Israeli Navy, as done routinely.

Israel also facilitated  the working permit regimes for young Palestinian to work in Israel by dropping the age of employment to 22, while increasing the numbers of work permits for employment in Israel to a total of 52,000, including overnight stay for 14,000.

While sustained security coordination assists the stability in the West Bank, Israel is troubled by the increase of terror acts conducted by individuals – 171 just during the month  August, as well as by deadly stone throwing, motivated by inciting rhetoric generated by Palestinian Authority high officials, encouraging violence and bloodshed. Israel expects the donor countries to denounce this type of rhetoric, which is not conducive to confidence and good will between the parties. Such security challenges should continue to serve as a mutual concern for both parties.

Mr. Chairman,

Israel shares the International Community concern of the Gaza Strip population distress. We are aware of their dire need for water and energy, of the urgent demand for reconstruction, and solutions for unemployment, the need for increased exports and movement. Therefore, Israel has initiated civilian steps such as increasing the quota of entry permits into Israel for merchants from 2,000 to 5,000; approving marketing of industrial goods and produce, primarily fish to Judea and Samaria, alongside expected approval of marketing textile, metal and steel scraps and furniture, and expansion of the fishing zone to 6 nautical miles.

Furthermore, Israel has been supplying additional 5 million cubic meters via the Nachal Oz Pipeline – the pipeline commenced operation on March and has been providing, on average, 700 cubic meters per hour, thus ensuring clean water for approximately 100,000 people; and has approved the donation of pre-fabricated homes from Turkey - 88 of them have entered so far.

But Israel's good will towards the Gazan population, as demonstrated through the vigorous reconstruction efforts should not be taken for granted,  as Gaza strip is under the control of Hamas - an internationally designated terror organization, who is constantly occupied with massive unlawful military buildup efforts.

Hamas is cynically using the reconstruction process and the Israeli periodic revision of the dual usage items list allowed into Gaza, in order to confiscate, purchase, store and smuggle materials for its rearmament and renewed military buildup, disregarding, again, the needs of its constituency – the Gazan population.

I would like to remind the distinguished forum,  that earlier this year, Israeli authorities revealed that Hamas is using the Kerem Shalom crossing to hide tons of dual-use items inside shipments of humanitarian goods. Since the beginning of this year more than fifty smuggling attempts have been aborted by Israel. The smuggled materials are used to rebuild attack tunnels, reconstruct training camps, and manufacture rockets.

It should be clear that on the road to recovery of Gaza, there must be zero tolerance for terror and violence. The rehabilitation of Gaza must go hand-in-hand with the demilitarization of Hamas and its proxies, and with the return of the Palestinian Authority to effective governance in Gaza.

Israel left the Gaza Strip 10 years ago. Israel wishes to avoid another conflict in Gaza. Yet, drip of rocket attacks being launched on Israel in recent months, on the backdrop of Hamas constant testing of its rockets -  launching over 170 of them since operation protective edge - is an alarming indication that Hamas propels itself towards another conflict.

Mr. Chairman,

Israel has partnered with the United Nations proposal to establish a mechanism for rehabilitating the Gaza Strip under the supervision and control of the UN. The mechanism was programed to facilitate progress in rebuilding the Gaza Strip, while safeguarding the security interests of Israel. This was meant to enable reconstruction by the Palestinian Authority, international bodies and the private sector. Israel declared its readiness to play its part and as a first step, we announced tens of new projects in Gaza and the doubling of the number of entry permits for the business sector.

Since then Israel allowed the entry of almost 2 million tons of building materials for the reconstruction mechanism and for international community projects, as well as for reconstruction of roads.
Of the 2 million tons, over 553,000 tons were sent for the reconstruction mechanism, over 380,000 tons for international community projects and over 1 million ton for reconstructing roads.

Over 254,000 tons of building materials have been sold to Palestinian households in Gaza. Of the more than 103,000 households authorized under the Gaza Reconstruction Mechanism to buy materials, over 96,000 households have completed at least half the reconstruction of their homes. Building projects in Gaza facilitated by Israel include housing, schools, clinics and infrastructure projects. Recent advancements in projects include laying the cornerstone for the third stage of a neighborhood in Rafah with 220 housing units and a cornerstone for the al-Zafer Tower project in Gaza City. Over 3,500 new housing units were already authorized by the GRM.

Since the 2014 conflict, over 347 projects have been already authorized by the GRM, as well as141 international projects outside this framework. Approximately 63% of the GRM projects are completed or in the implementation state. Over 70% of the international projects outside the GRM have been completed or are in implementation.

We have been coordinating engineers and other relevant professionals for international community projects, and have been facilitating the movement of Gaza reconstruction personnel, with more than 1,000 permits issued since summer 2014 for travel from the West Bank to Gaza.

Israel has undertaken additional measures that while not directly connected to the reconstruction efforts, are aimed at contributing to the economy of Gaza and the lives of its residents. The establishment of a Coca-Cola factory, with the requested equipment, in the Karni Industrial Estate, approved the import of engines and second-hand vehicles into the Gaza Strip, and continued and even improved movement for medical purposes.
 
In addition to granting entry permits into Israel for urgent medical care for patients and their escorts, Israel has raised the number of permits for travel to the West Bank for non-urgent medical care.
Israel has coordinated the movement of almost 650 doctors and medical teams from the Gaza Strip to the West Bank for continuing education projects and conferences.

Moreover, Israel is facilitating the exit of Gaza Strip residents abroad via the Allenby Bridge crossing between the West Bank and Jordan. This route has been used by almost 1,800 Gaza citizens since last summer, for medical treatment, participation in conferences and university studies. On average, over 20,000 people a month have entered Israel through the Erez crossing from the Gaza Strip in the last few months.

It is also important to note that for the past five years, all types of foodstuff, as well as all consumer and other goods, are allowed to enter Gaza from Israel, excluding weapons and a short list, which has already been revisited twice, of dual-use items that can be exploited for use for terror. On top of all that, the upgrading of the capacities of the Kerem Shalom and Erez crossings was completed, resulting in an increased capacity to 800 trucks a day. Approximately 10 million US$ were allocated for development works to further increase their capacity to over 1000 trucks a day.

We trust that all these steps and measures have been having an impact on the Palestinian civilian's situation in the Gaza Strip. Although there is no doubt that the continuation of the donors' assistant to the reconstruction of the Gaza Strip is critical, yet we believe that the Palestinian Authority leadership must also play a constructive and practical role in this process, not letting internal political disputes and splits endanger the reconstruction efforts and demonstrating a commitment to bilateral cooperation rather than unilateral actions.

Mr. Chairman,

I trust by now, Israel's commitment to the development of the Palestinian Economy while cooperating with the Palestinian Authority, is clear.

Once again, Ambassador Wennesland, We wish to thank you for organizing this meeting. We do hope that together with the PA as our partner, and the continued assistance of the Donors, we will advance towards achieving our shared goals of economic prosperity and sustained security for the Palestinian and Israeli people alike.

We look forward to the coordinated collaboration with you all, and we welcome your engagement in bringing recovery and peace to our region.

Thank you.