International Business: COMMENTARY
COMMENTARY: MIDEAST PEACE: CLINTON SHOULD STEP UP THE PRESSURE
It looks pretty bleak out there for the Middle East peace process. Israeli Prime Minister Benjamin Netanyahu's five-month-old government and Yassir Arafat's Palestine National Authority have exchanged bitter charges over who's responsible for holding up a deal to move Israeli troops out of Hebron, the last Palestinian population center in the West Bank still controlled by Israel.
Just weeks after the last outbreak of violence in the region, passions are inflamed again. This time, the source of tension is the Israeli government's authorization of an expansion of Jewish settlements. Israel's Arab neighbors look on apprehensively, anxious about being drawn down into a new and uncontrollable vortex of violence. "We are looking forward to better times," says Egyptian Foreign Minister Amr Moussa, "but there are increasing clouds of frustration and doubt."
BRIGHTER FUTURE. Yes, it's bad. But there are signs the weather could clear, with a little luck and some prodding from the U.S. Cut away the rhetoric on both sides, and you find a common realization that the peace process is the only game in town. Arafat, who must administer 2.5 million Palestinians whose standard of living has plunged 30% in the last two years, desperately needs a deal that can lead to a brighter future. And Netanyahu's team is learning that pushing off a deal with Arafat into the indefinite future, which seemed to be the Prime Minister's plan when he took office last June, is simply no longer an option.
Netanyahu is getting that message from Washington. And back home, for the first time in Israel's 48-year history, business is emerging as an influential, independent lobby--one that no longer moves in lockstep with the government. When Netanyahu was unwilling to meet with Arafat, business leaders were busy keeping lines of communication open with the Palestinian Authority.
Executives such as Koor Industries' Benjamin D. Gaon and Israel Manufacturers Assn. President Dan Propper put it plainly: Without progress with the Palestinians, there's no way to maintain Israel's impressive economic track record. And Netanyahu might as well forget his vision of quadrupling his country's $90 billion economy over the next 15 years if the peace process dies. Stability, admits Bank of Israel Governor and chief Netanyahu economic adviser Jacob A. Frenkel, "is the key background music we need."
This message is finally sinking in. In public, Palestinian and Israeli officials may be trying to stake out the high moral ground in front of CNN cameras, but behind the scenes the talks are virtually nonstop. "There was an almost total lack of confidence at the beginning," says a senior U.S. negotiator. "Now, there is a definite warming-up process taking place."
The Hebron deal, which is close to being cut, could be a watershed. It would signify to Palestinians that they can do business with the new team in Jerusalem. Indeed, a pact would help create a climate in which economic issues can be resolved--from removing restrictions on the flow of goods out of Palestinian territory to setting up a port in Gaza.
Of course, there are land mines, especially if removing Israeli troops from Hebron is followed by bloodshed. Bolstered by a 5-seat majority in the Knesset, Netanyahu can probably deal with political opposition from his own right wing to a Hebron agreement. He can present, with some justification, the foot-dragging on Hebron as tough negotiating. Moreover, the opposition Labor Party has indicated it will back Netanyahu on Hebron. But he will need steady nerves indeed to weather a new outbreak of violence.
One thing the peace process will probably need is greater determination from the U.S. to help broker a solution. Thanks to that initial breakthrough in Oslo by Palestinian and Israeli negotiators in 1993, Bill Clinton has had a spectacular, almost effortless, run as a peacemaker. Now, as progress becomes more difficult and halting, bringing the full weight of U.S. Presidential prestige to bear on both sides could work wonders.
For both Palestinians and Israelis, there is new realism. Bolstering that spirit, as only the U.S. can, will go a long way to scattering the storm clouds gathered in the Middle East.By John Rossant