Abu Dhabi, UAEFriday 20 September 2019

G20 and Peace to Prosperity: a tale of two very different economic summits

In Japan, the US president strode with confidence, but Jared Kushner's plan faltered in Bahrain

White House senior adviser Jared Kushner speaks at the Peace to Prosperity conference in Manama, Bahrain. Reuters.
White House senior adviser Jared Kushner speaks at the Peace to Prosperity conference in Manama, Bahrain. Reuters.

The G20 summit in Osaka has been the most important event of the past week. The US president headed to Japan with all the confidence of a leader of the world’s largest economy and sole superpower, and has demanded other world leaders pay their share of the cost of US-led security arrangements that protect their interests, and delivered to them the message that he is serious about rearranging international trade relations to protect his own country.

The Iranian issue has failed to dominate the agenda. As has the Palestinian-Israeli situation, regional conflicts or terrorism. The mainly economic summit has been an opportunity for bilateral talks between the leaders of the US and China, Russia, and the European powers, whom Mr Trump wants to reform their economic and defence policies, whether under the Nato umbrella or regarding Iran.

The Europeans, Russians, and Japanese leaders have been trying to defuse tensions between Washington and Tehran, amid talk of a de-escalation deal that would pave the way for a more comprehensive agreement. The focus on nuclear armaments and missile programmes has been causing a lot of anxiety in the Gulf region, where many capitals fear they would become a theatre of war while being excluded from the negotiating table.

In this context, the US discourse has been focusing less on Iran’s regional role and more on issues of disarmament. Informed sources said that Mr Trump and Mr Putin did not reach a specific agreement in their meeting or talk in depth about Iran’s role in Syria, contrary to the wishes of the US, Russian, and Israeli national security chiefs who held an unprecedented meeting in Jerusalem earlier this week to discuss the very same issue. Instead, the meeting focused on a US request for Mr Putin to help bring China into arms reduction talks, which Beijing has resisted so far.

According to Russian sources, Moscow has communicated to the Americans that it is not yet willing to trade the Iranian role in Syria in return for the US turning a blind eye to what it needs to do there to accomplish its objectives. “It is not in our interest to enter a conflict with Iran with unknown consequences… we are now focusing on Turkey and we do not want to lose both countries,” said one source, adding that China and India agree with the Russian position of not coming down hard on Iran. The source added that China’s purchase of Iranian oil remains an important card should US-Chinese negotiations fail.

It is also important to tackle another supposedly historic event in Bahrain: the unveiling of the economic component of the plan for peace between the Palestinians and Israelis entrusted by Mr Trump to his son-in-law Jared Kushner. The initiative has been referred to as the “deal of the century” but, in Manama, Mr Kushner preferred “opportunity of the century”.

Mr Kushner has made several mistakes: first, by severing the relationship between economics and politics in the peace plan. Second, by unveiling the initiative in unconnected stages and surrounding the political component with a secrecy that has drawn the ire of essential partners.

Furthermore, Mr Kushner erred in his arrogance and condescension during his presentation at Manama, which failed to build confidence and trust. He made yet another mistake when he alluded to press leaks detailing information about the political part of his initiative, and exposed his own claim of the need for secrecy to ensure its success, and his bias in favour of Israel.

Mr Kushner opened his presentation by disregarding all previous political and economic peace initiatives for Palestine and Israel, as though no one before him had thought of the economy and private sector as leverage.

The idea has been proposed countless times by successive US administrations, including by former Secretary of State George Schultz in the early 1980s. Yet, it has always failed, because it bypasses the national rights of Palestinians and renders them a stateless people.

Worse still, Mr Kushner’s Prosperity to Peace initiative appeared determined to erase the word “occupation”. It was not mentioned once in all official US statements. He also appeared irritated when the UK’s former prime minister Tony Blair told him it would be foolish to pursue an economic solution without building political stability, and that serious peace should be based on the two-state solution and respecting the legitimate rights of Palestinians. Mr Kushner insisted that the workshop was a purely economic effort aimed at helping the Palestinians when its real purpose was to create new norms and erase reference points for peace established under international law.

Mr Kushner’s economic plans have been preceded by several similar efforts, including one led by the World Bank in the 1990s. Moreover, Palestinian former PM Salam Fayad led an effort based on developing Palestinian infrastructure and was a pioneering proponent of the notion that this would be a de facto challenge to the occupation. On the sidelines of previous sessions of the World Economic Forum, Palestinian business leaders also sought to develop a working mechanism in collaboration with their Israeli peers as a way to foster peace based on the two-state solution.

Mr Kushner has not reinvented the wheel, but he has expanded the framework to include major US and international corporations, who sent representatives to Manama.

The leaders of those corporations from the US, Europe, and the region said they were willing to invest in utilities, transport and communications, provided that security and the rule of law are assured. Mr Kushner failed to state how he would guarantee this in his political plan, to be unveiled later. This exposes again the illogical nature of discussing economics without politics, and the arrogance of assuming that people would buy into an economic plan without seeing the political terms.

When Mr Kushner was asked which should take precedence, the economic or political component, he said they should be implemented simultaneously, adding that the economic plan cannot be put into practice without a political solution, but that, at the same time, a political solution was not enough without improving people’s lives.

The economic plan itself consists of 140 pages and features 179 separate projects, and deserves to be assessed in relation to the development of Palestinian infrastructure. But it is bizarre that Mr Kushner has opted for suspense and withholding information about the political component. He then compounded matters by dismissing the Arab Peace Initiative (API).

After the workshop, Mr Kushner adjusted his remarks and said that in order to reach a deal, concessions must be made by both sides, where the potential political solution would fall somewhere between the terms of the API and the Israeli position. However, Israel has no official plan in response to the initiative, which was launched some 17 years ago.

Indeed, most of the terms of Mr Kushner’s plan require measures by Israel itself, not by the Palestinian authority in Ramallah, or Hamas in Gaza. The occupation remains the most powerful entity on the ground, and talk of land ownership is invalid at a time when Israel is moving to annex Palestinian territories that illegal settlements have been built on. Meanwhile, the $50 billion earmarked for the plan remains relatively low, according to business leaders.

The Palestinian Authority’s snub of both the economic and political components of the initiative is a mistake. It should stop isolating itself, and to signal approval and disapproval of specific details of the plan, and avoid being absent. Sulking in silence is not a policy.

Updated: June 29, 2019 06:16 PM

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