Sidestepping Dependency

In the complex transfer of power between Israel and the Palestine Liberation Organization (PLO), the world’s focus has been on the difficult, often violent issues of security that surround the creation of limited Palestinian autonomy in Gaza and Jericho. In this atmosphere, the economic agreement signed by the two parties in Paris on April 29, 1994, was hardly noticed. Amid the humdrum details, however, a conventional wisdom came to be shared by participants and observers alike, that a high degree of economic cooperation between Israel and the evolving Palestinian entity was a panacea for the region’s problems. Close cooperation between Israel and the nascent Palestinian economy has been universally heralded as a harbinger of a wider regional structure of economic cooperation, if not integration. The European Community is the model.

Like all conventional wisdom, however, this hypothesis should be tested, and the analogy with the European Community should be looked at more carefully. Even a superficial glance at the main ingredients of such a vision raises doubts about its applicability.

A COMMON MARKET

A Middle Eastern common market was a concept often used by the discussants during the Paris talks. It was premised on what appeared to be the obvious: shared economic interests, a high degree of cooperation and mutual interdependence, and a desire to raise living standards, especially among the Palestinians, all of which were viewed, almost without demurral, as the best guarantees of stability and peace in the area. Did not the French and Germans bury the hatchet, overcome generations of strife and build, on a foundation of coal and steel, a durable peace in Europe? If so, why not Jews and Arabs?