Since he took office, Donald Trump has expressed interest in “unlocking the potential of the Palestinian economy.” This vision has evolved into the organization of a “Peace to Prosperity” workshop in Bahrain on 25 and 26 June. American conveners of the workshop say it offers Palestinians economic benefits and large-scale investments, and aims at initiating projects of regional economic cooperation. According to Senior Middle East advisor, Jared Kushner, the proposed plan reveals a fresh approach to peace-making.
However, while a number of recent American maneuvers indicate the adoption of a new approach to resolve the political deadlock, the use of economic means as a way to transition to political peace is neither new nor likely to succeed.
The Historical Illusion of “Economic Peace”
Contrary to Kushner’s claim, the Bahrain workshop falls within longstanding American and Israeli claims to improve Palestinian economic conditions and increase economic cooperation to pave the way for “peace.” This economic peace approach is based on the belief that transition to political peace could be achieved by ensuring higher economic growth and interdependence among countries. The assumption is that the economic benefits that arise from economic cooperation and better living conditions would raise the cost of a political conflict, thus creating interest in peace.
This approach, which was at the heart of the peacebuilding efforts in Europe after World War II, has for long inspired American and Israeli policies in Palestine. From the “Open Bridges” policy advanced by Israel’s Defense Minister, Moshe Dayan, in the 1970s, to U.S. plans to “improve the quality of Palestinian life,” promoted by Secretary of State George Shultz in the 1980s, to Israel’s Prime Minister, Yitzhak Rabin’s plan to ease conditions on Palestinians for conducting business in 1992—all of these policies in the pre-Oslo period focused on improving economic conditions for Palestinians, based on the premise that such improvement would in turn raise the cost of a political confrontation with Israel, thus pacifying Palestinians.
These economic peace strategies were further developed as part of the Oslo “peace process,” with more emphasis on promoting economic interdependence at the regional level. Shimon Peres’s vision of “The New Middle East” and the different regional economic development working groups hosted by Arab countries (Morocco in 1994, Jordan in 1995, Egypt in 1996 and Qatar in 1997) all aimed at increasing economic ties among Israel and Arab states, as part of the multilateral peace process that was launched after the Madrid conference in the early 1990s. American administrations endorsed regional economic cooperation as a way to reduce the likelihood of conflict. Parallel to these multilateral meetings, astronomical amounts of aid, or “peace dividends,” were also distributed to Palestinians with promises to better Palestinian standards of living and economic growth, while increasing economic cooperation with Israel.
However, despite this historical record of economic peace strategies, it was not until 2008 that the concept of economic peace was popularized when Benjamin Netanyahu, then Likud chairman, strongly advocated for it. His vision that economic development “mitigates” problems was based on the nexus of security, economic development, and peace. More permits and facilitation were provided to Palestinians to increase individual wealth while joint economic projects were also advanced. A similar approach guided U.S. Secretary of State John Kerry’s plan, in 2013-2014, to boost the Palestinian economy while promising mutual economic benefits to Palestinians and Israelis.
The Bahrain Workshop: A Continued Trend of Failure
Where the goal of achieving peace is concerned, the strategies above have been nothing short of an absolute failure. The eruption of the First Intifada following Shultz’s policy, and the second Intifada during the “peace process” definitively delivered the ultimate blow to economic peace and highlighted the deficiency of putting economics over politics.
The economic workshop in Bahrain is no exception to this trend of failure. As long as economic development is seen as separate from politics, and as long as Israel’s colonial structures of power and control are not addressed, then every strategy that aims at the development of the Palestinian economy will be destined to fail, since the Palestinian economy is a political construct heavily embedded in Israel’s colonial enterprise. It is only when there is an end to this enterprise and a lifting of all measures to restrict Palestinian movements and access, that Palestinian economic development can take place.
The reality is that these strategies simply sought to manage the so-called “conflict” and the Palestinian population, under the guise of paving the road to peace, while obfuscating the structures of colonial domination. The management of the population partly happened through the disbursement of economic rents/ benefits that created vested interests in the “peace process” among a group of Palestinians.
For instance, the post-Oslo period has witnessed the growth of a political and economic elite that is materially dependent on Israel, given all the privileges it has access to such as VIP and BMC cards, import licenses, and permits, among other benefits—privileges that are conditional on acquiescence to Israeli rule. This has been exacerbated by the growing political and economic liberalization in the occupied Palestinian Territories, promoted by the Palestinian Authority (PA) and international donors, which has undermined collective political projects while creating a constituency that has material gains from the continuation of the Oslo process.