Israel and Hamas are fighting another 10 day or so duel.

It is evident that militarily, Hamas has been crushed. The money pleaded out of the international community to counter the poverty in Gaza was directed to fund miles of underground military tunnels and also 14,000 rockets directed at civilians. Their potency has been heavily damaged.

Politically, Hamas has strengthened itself amongst the Israeli Arab community and in the West Bank, at the direct expense of the antiquated oligarchy of the Palestinian Authority (PA). And these could be the more dominant factors emerging from this latest agony.

As a sidebar, it is worth mentioning that both the PA and Hamas leaders are now vastly wealthy individuals. However, while the former strive for an independent state, the latter in Gaza look to set up a Caliphate, stretching into Syria and beyond.

Meanwhile, from southern Gaza to northern Israel, people are trying to earn some money.

We know that the Israeli economy is at a crossroads. Despite the hopes of Netanyahu’s led Ministry of Finance, the impact of the lockdown in the first quarter of 2021 was very more disasterous than anticipated. GDP dropped 6.5% at an annualised rate. Yet in the same period, Israeli start-ups raised a staggering US$5.4 billion.

What will happen as a result of the fighting? I suspect that the answer is nothing too serious. Why?

The Palestinian economy is smaller by definition. There are sections that were doing very well until the corona epidemic.

  • The number of nights spent by tourists doubled to two million during the decade to the end of 2019.
  • Unemployment in the Ramallah area is about 10%, (compared to about 40% in Gaza).
  • There are growing numbers of people that have studied at university and are entering hightech. Some have found a way into Israeli companies. Others are creating a local eco-system.

What could put an end to this cautious yet steady growth, particularly in the West Bank?

Critics of Israel be warned, because the answer does not hide in the policies of whatever government is to be formed in Jerusalem. Israelis have a direct interest in this progress. Not just because it cements peace, but he process opens up new markets – services, goods, and trained workers.

So, go back to what I wrote earlier. Up to now, Hamas has not been allowed to set a foot into the West Bank. In May 2021, as Mohammed Abbas slides into his mid 80s and as the Israeli Prime Minister invests all his spare time in saving his political legacy, Hamas has found a new legitimacy for itself in the West Bank.

Those are the background factors which allowed this tragic fighting to flare up again. And that is why the hope for additional Palestinian prosperity is under threat.

UNRWA was set up in 1949 to help Palestinian refugees. Today, it has an annual budget of around one billion dollars. And, special programmes or campaigns can see similar additional amounts raised from donor countries, via their taxpayers.

UNRWA is a nebulous body. It uses the UN initials, but does not seem to come under UN auspices or jurisdiction. Last year, President Trump suspended American funding and Washington was the largest donor. In recent months, four other countries have followed suit. Even New Zealand, no friend of the Israeli government, is withholding support.

UNRWA’s history has been unusual. It is nearly 15 years ago, when one commentator observed that:

Despite over 50 years of experience and employing around 25,000 local Palestinians, UNRWA simply does not do its job effectively. A recent World Bank report on the Palestinian territories noted that “55% of those who receive emergency assistance are not needy… 32% of the needy do not receive emergency assistance.” If UNRWA’s money does not help solve Palestinian poverty, then who are the true beneficiaries of its lavish funds?……..

Most Palestinians in Jordan have resolved their economic issues without UNRWA. The 1997 report from the Norwegian Fafo Institute for Applied International Studies compared the situation of the 13% of Palestinian Arabs in the Hashemite Kingdom who were being catered to by UNRWA to the remaining 87%. It concluded that the Palestinian Arabs cared for by UNRWA continued to live in destitution, while the others maintained a similar economic level to their fellow non-Palestinian Jordanian citizens.

The Norwegian Refugee Council has invested much resources into the Palestinian issue. That said, it has just published a report, which concludes: –

Today, 25 August 2019, marks the two-year anniversary of the start of the largest ever stream of refugees out of Myanmar….. Since 25 August 2017, around 740,000 Rohingya have fled Myanmar to Bangladesh. More than 630,000 are living in Kutupalong, the world’s largest refugee camp.

I am prepared to bet that these wretched people do not receive even 50% per capita of what the Palestinians do. And what does reach them is carefully accounted for.

Meanwhile, the UN is allowing a Palestinian oligarchy to support itself, at the expense of unknown taxpayers and to the detriment of other needy causes. What conclusions would you draw?

Postscript: I just checked the UNRWA website. I could not find budget figures for post 2017.

One of the core arguments of the British “Leave Europe Campaign” is that the EU is one big amorphous bureaucracy. For example, accountability and transparency are words that rarely find their way into the diplomatic nous. Nowhere has this been more true than the issue of paying out money to the Palestinians.

Back in the early 1980s, the EU took a deliberate decision to match the USA aid for Israel (and Egypt). The Palestinians needed support. Within two decades, the World Bank had declared that the Palestinians were receiving more aid per capita than any other target population, including Tsunami victims.

Not only was much of this cash was coming from generous EU taxpayers. Analyses of the Palestinian Authority’s budget had revealed that the PA was failing to raise taxes by any significant amount. And what did enter the coffers of the Treasury in Ramalalh was often disbursed to the families of those imprisoned in Israel on terror charges, to the security forces fighting Israel, or simply to the families of the leading leaders of the PA and Hamas.

Nothing new there?

In 2016, the British public informed Brussels what it thought of its policies. Somewhere in that message was the whole theme of vast sums disappearing into black holes to fund the favourite political campaigns of the few. And this included the politically correct issue of helping the Palestinians. For example:

The EU is the largest contributor to UNRWA. Together with the EU Member States, the EU’s contribution for 2016, 2017 and 2018 amounted to €1.2 billion……EU support to the Palestinians covers a wide range of areas, including humanitarian assistance, capacity building, democratic governance and socio-economic development. In 2018, it amounted to a total of nearly €350 million. The funding is framed by the “European Joint Strategy in Support of Palestine 2017-2020” agreed by the EU Institutions, 22 EU Member States, as well as Norway and Switzerland.

Add in the money for support to various NGOs. Then season that off with contributions by individual governments for pet projects. That €1.2 billion has easily doubled!

For years, pro-Israel pressure groups screamed. One of the initial campaigners was Arnold Roth, whose daughter was murdered by a Palestinian called Tamimi, whose family find support in the actions of the EU. The Palestinians do deserve a better life, but make sure that you now where the money is going. As for UNRWA, who is supervising this amorphous multi billion body, employing 30,000 people and which has yet to resettle even one Palestinian in over seven decades?

Last week, by some ironic coincidence, the extent of the gross misuse of funds for the Palestinians leaked out in two separate news items.

First, The United Kingdom’s Information Commissioner Elizabeth Denham has ordered the Department for International Development (DFID) to disclose audit reports of accounts into which British grant money was transferred and allegedly used to pay salaries to convicted Palestinian terrorists.

Why? It has emerged that:

a) In the period 2008 to 2015, Britain gave grant aid to the PA’s Central Treasury totaling £430.5 million (NIS 1.85 m.), via the World Bank. The aid was untied and not earmarked for a specific project.…..
b) PA pays more than 8% of its total budget through its Central Treasury to fund salaries for convicted terrorists, which serve to reward and encourage terrorism. As such, it is possible that some of the funds provided by the UK were used to pay these salaries.


Awkward piece of news no’ 2 is that it leaked out that UNRWA has not just failed to deliver on its remit. It has been cited for corruption, nepotism and sexual abuse. At least for now, Switzerland and the Netherlands have ceased funding.

Double that ooops!

Meanwhile, as ever, only Qatar is propping up the finances of the PA. Quelle Surprise! Yet again the government of President Abbas has run out of money! It is even turning to cryptocurrencies for help.

So after nearly four decades of positive intervention, what have the European taxpayers got for their buck – or should I say Euro – regarding the Palestinians? And we are talking about billions of Euros that could have gone to Greece or Spain or internal structural projects or ….you name it.

It is difficult to argue for anything positive. There again, questions abound.

  • If billions had been allocated to any other project without a net social gain, would there have been such a placid response by the EU bureaucrats or its politicians?
  • Why is it that the EU has consistently rejected the classic Israeli argument for a new approach to helping Palestinian society? What are they not telling us?
  • And on this basis, can anyone really blame the UK for bolting the EU? The taxpayers deserve better, and so do the Palestinians.

The unnamed Lieutenant-Colonel from the Israeli intelligence forces said that they cried, when his team realised that they had identified the body of Zechariah Baumol. Somehow, after 37 years, the Israeli army had tracked down his place of burial. With the help of Russian President Putin and a third country, the reserve soldier, killed in Lebanon, had been brought out of Syria and was laid to rest in Jerusalem.

April 2019 is a horrendously divisive time in Israel’s history. The general election campaign has taken few hostages. Somehow, the story of this first sergeant, wrapped in the humility of his mother, sister and other family members, has humbled the nation. Prime Minister Netanyahu called his ‘return home’ as one of the most emotional episodes in his reign at the top.

In a sense, for a few hours, campaigning ‘seemed’ to be thrown to the gutter, along with all the useless flyers and interfering WhatsApp messages. The failing health of the President’s wife, Ruhama Rivlin, has also struck a cord of unity, even if the President himself had been insulted earlier in the week by the Prime Minister.

However, to my amazement, the other picture that has caught my attention was in today’s edition of the Ha’aretz newspaper, known for its vocal support of Palestinian rights. On page 24, we see a full picture. The caption describes Palestinians running away from gas canisters launched by the Israeli army, presumably at a demonstration near the border with Gaza. In the foreground, are seven children and one adult. Sad, no?

Now remember, for the first time in years, the Palestinian issue is very much off the front pages in this election. What is really sad for me is that the picture has a misleading attribution. Over 20 other people in the background are just loitering about – no tear gas is bothering them. No child is wiping their eyes.

And then you have to ask. Who takes under age children to a demonstration, especially when violence is a probability,…..and why?

Take a step back. In 2010, the Arab League set up a special fund for donations to be funneled to the Hamas-run Gaza Strip. Currently, the World Bank estimates the GDP of Gaza at 1% of that of Israel. What has gone wrong?

Egypt’s border closure back in 2012 has had a major impact. Hamas determination to invest in military aggression against Israel – 1,000 rockets fired in 2018 alone – has diverted resources. In the past year, President Abbas has cut off funding from his Hamas enemies.

More pertinent is the question what happened to that money from the Arab League? At the end of 2014 and the latest major fighting with Israel, US$4 billion was promised. In the following two years, about US$1.8 billion turned up. New suburbs were created. Water systems were installed.

But, then the donors assessed the level of graft by Hamas officialdom. According to the World Bank, the money flows faltered to US30 million monthly in 2017 and a paltry US$4 million last year. Combine that with Abbas cutting 30% and then 50% of the annual US$1.5 billion allocation, which he was supposed deliver, and then you can begin to wonder.

The stats continue. The standard of living in Gaza dropped by 10% in 2018. It is 140% higher in the West Bank, as ruled by the Palestinian Authority of Hamas.

The fundamentalist and intransigent, terrorist government of Hamas was propped up by Arab friends for years. It is currently funded by suitcases (literally) of dollars from Qatar. Weapon systems, originating from Iran, are still smuggled in.

Whatever the outcome of the Israeli election, the internecine Arab hatred will continue. It is sad. It is tragic, but it is not Israel’s fault. Whether Netanyahu wins or not, the upshot of the economics of Gaza will see the adult population continuing to send their kids to the front line. Sickening.

Israel is where Western countries send delegations to learn how to copy the success of the start up nation. Just this week, it was announced that Mellanox exited for a mere US$6.9 billion. Who’s next?

And yet there are those who are questioning if the proverbial bubble has burst for the Israeli economy. The fiscal deficit is climbing. The general election on April 9th and is likely to result in further political instability. Can the economic triumphs of the past decade be repeated?

Palestinians benefit from a resilient Israeli economy. Legally or otherwise, over 100,000 labourers find employment daily via their neighbours. If they gainfully registered they receive full social benefits, which barely exist in the territories. That said, since the Oslo Accords, both in the West Bank and particularly in Gaza, the Palestinian economy has shrunk.

Yes, there was a positive blip at the end of the 1990s – 15% improvement for two consecutive years. However, Chairman Arafat’s decision to launch the Intifada killed that off, as well as others.

The West Bank has historically been the stronger of the two districts. According to an analysis by Doron Peskin, unemployment has risen slightly over the past two years to almost 18%. Arguably of more concern is that economic growth has shrunk by almost 50% to about 2.7% annually. The data for Gaza is far more depressing.

What is important to note about these numbers is that natural population growth is higher than 3%. President Abbas is ill and is seen increasingly as less able to command respect. And we have observed that the Israeli economy may be weakening, and thus less able to take up some of the slack.

Next stop? I am not sure. However, just before Hamas launched two rockets at Tel Aviv last night, there had been a massive demonstration in Gaza. The populace were revolting at the high cost of living. At the same time, the shops in the better off suburbs still appear to be remarkably busy.

I suggest that there is a lesson here. The Palestinian leadership should learn from their Western colleagues, listening to Israelis about how create wealth rather than seeking to destroy hope.

Eight days have passed since a Palestinian kidnapped, handcuffed and shot two Israelis in a factory in the industrial zone of Barkan in the heart of the West Bank.

A few days later, this form of ‘self-defense” was justified by yet another resolution from the British Labour Party, this time emanating from the area of Brighton. Personally, I find this form of argument repugnant. It is barely discourse. Rather, it represents a set of statements based on hatred, whose design is the very opposite of peaceful coexistence.

I am not going to argue that the relations between most Jews and most Arab in the West Bank is like a rose garden on a summer’s day with birds twittering in the background. However, Israel’s weekend newspaper cobbled together some facts that are worth copying here and analyzing.

There are about 100,000 Palestinians working in Israel on a daily basis, and roughly 2/3 have a license to do so. Another 30,000 work in places like the Barkan area. If the average monthly wage in the Palestinian territories is around 2,500 nis, a typical Palestinian will bring home about 6,500 nis (about US$1,800) from an Israeli employer.  Of the 8,000 or so workers in the Barkan district, about 3,500 are Palestinians with a license.

Let us be clear. Since 2010, the Palestinian Authority, which controls the West Bank, has officially banned its followers to work for Jewish enterprises. These are the same companies that by Israeli law have to pay the Palestinians full social security contributions, which are negligent under Ramallah law.

In some factories, Palestinians do climb up the tree of management, although rarely to senior levels. That said, incidents of murder or lesser violence have barely been reported since the industrial zone was established 36 years ago.

The BDS movement, prominently supported by much of the Labour Party, would put an end to this creation of mutual wealth and trust. In other words, the Israelis should be boycotted and sent packing. In their place would be……….well, I suppose fewer Palestinians, earning less than half their previous wages, and without the social benefits that a Labour Party demands for its own membership in the UK.

I suppose this is where hatred is so valuable, as it is required to help to cover up the malignant contradictions of the BDS thought process. And in the meantime, the local authorities are constantly preparing more space for factories in the West Bank, which looks to be an economic win-win policy for all parties, who care.





It has been an awful night. At least 80 rockets have been launched into southern Israel since midnight. As a friend of mine posted on Facebook:

We were woken repeatedly during the night by sirens and audible rocket attacks from Hamas in Gaza.
The Rocket app recorded over 125 rocket and mortar attacks on Israel last night.
Hundreds of thousands of people spent the night in a shelter or safe room (if they have one – we don’t).
Did anyone hear about this on a foreign news station?

What a way to live! Would you accept that in your backyard? Will Israel go into Gaza? I have no idea, but this is not just a challenge to the country, this terrorism is a direct threat to Prime Minister Netanyahu. He has cultivated a reputation as Mr. Security. In other words, the country can depend on him.

This somewhat cynical consideration is incredibly pertinent, because just two days ago Israel’s High Court of Justice allowed the government just three more months to implement the new draft law. In effect, this would force ultra orthodox Jews to face conscription, which their political leaders see as a double red line, which should not be even considered.

Now, as Israel’s government is a coalition, dependent on these same parties, this means that the government is likely to fall, maybe before the end of the summer recess. In theory, this would suit Netanyahu just fine. Sometime towards the end of the year, he may face calls for prosecution. The noise of the elections should preempt and then dampen the clamour for his withdrawal from public office.

It should be noted that in poll after poll, Netanyahu is riding high. And it is assumed that after any such early elections, he will again ask the ultraorthodox to support his new government, assuming he is asked by the President to form it. (I shall spare yet another cynical comment).

It is incredible to comprehend that none of the multiples of opposition parties have thrown up a leader of strength and moral worthiness, who can challenge the incumbent Prime Minister. Certainly, the sharp words of the Druze community over the past few weeks have left him slightly wounded. A poor performance against Hamas this summer could also dent his popularity. And that is it.

One thing is clear to me. However Israel does respond to Hamas, it could eventually be seen in the context of a future general election. What a sad way to run a beautiful country.


The clashes on the Israel-Gaza border fence came to a head 2 weeks ago. At the cost of 60 lives, the leadership of Hamas secured an international PR triumph, while Israel ensured that no violent protesters were left free to attack townships nearby.

But what did the average Palestinian obtain out of his violence? After all, since the protests began on 30th March, about 120 people have been killed. According to Amira Hass in Ha’aretz, who is known for excellent contacts in the Palestinian territories, 42 were members of Hamas. A further 20 or so belong to another terrorist organization, Izz ad-Din al-Qassam brigades. Why the 58 remaining citizens were not prevented from going into a war zone is beyond me.

It is well established that the economic situation in Gaza is simply dire. In fact, one person was recently filmed committing suicide, possibly due to financial distress. The World Bank’s latest report details: –

  • 44% unemployment.
  • A drop in real wages by 27% since Hamas seized power from the Palestinian Authority a decade ago.
  • At least a third of the population survives below the poverty line.
  • Most of the water is unfit for drinking, while there are frequent power cuts.
  • And so the list goes on.

How much would it take to fix all this? According to an item in Yediot Ahronot newspaper, US$1.3 billion alone is required to clear up the water system. And relaxing border regulations with Egypt and Israel would contribute and additional 11% to the GDP – although for now this is unlikely, because the main export from Gaza is terror.

In parallel, there still appears to be enough resources available to invest in the continuous improvement of Hamas’ offensive capabilities, despite the freeze in wages.

Now pause for a moment. While people were dying in Gaza, what was the situation in the West Bank? Troubles and protests? Yes, but to a very limited extent.

Let me explain the difference, by looking forward to an event, which is due to take place in Jerusalem in May 2019. That is when Israel is expected to host the Eurovision Song Contest. Amongst the significant logistical demands that such a show creates, the host city will be flooded with thousands of additional tourists and also members of the numerous TV crews.

Jerusalem only has about 9,000 hotel beds. Capacity is normally high in May in an average year. Thus, other cities will be called into help to take up the slack, and that list will probably include Bethlehem and its 1,000 bed capacity. In other words, Israel can share part of this economic bonanza with the Palestinians, who are hardly likely to boycott this cultural cooperation.

Can you imagine Hamas accepting such cooperation and an influx of capital? In doing so, it would have to give up on its policy of violence.


This week, Palestinians are being encouraged to demonstrate, and in some cases, violently. Today, America will open its embassy in Jerusalem. Tomorrow will see the culmination of six weeks of riots on the border with Gaza, which ties in with Naqba Day.

One of the motivating factors behind these tensions is the poverty in the Palestinian territories. And it is generally accepted that Israel is to blame for all the woes. Israel is rich. Israel occupies. Ergo, Palestinians are poor.

The fact that the leaders of Fatah, the main faction of the Palestinian Authority (PA), and Hamas are stinking rich seems to be irrelevant. Similarly dismissed is the issue that under Israel governance, the Palestinian economy boomed until the late 1990s.

Ha’aretz, an Israeli paper not known for being sympathetic to the current government, gave light on Friday to a very different approach. It discussed how at a recent Fatah conference in Ramallah, the non payment by the PA of April’s salary to 40,000 civil servants in Gaza was the hot topic.

Remember that it is now over a decade since Hamas violently eradicated the PA from the Gaza Strip. And the attempt on the life of the PA Prime Minister while visiting Gaza is still seen as a major insult by President Abbas.

These civil servants represent about 14% of the work force in Gaza. The value of their salaries is about 80 million shekels, the equivalent of a little over US$20 million. Throw in the fact that Hamas has increased taxes over the past year, and all this adds up to a dearth of money in the Gaza economy…. in the very week that Ramadan is about to commence.

According to Reuters, May’s wages have turned up, but with a 20% pay cut automatically docked. The squeeze is on, and Israel is merely a bystander in this powerplay? Well, not entirely. Potentially, it could up even further the humanitarian supplies flowing into the costal territory via the Kerem Shalom crossing point.

The problem is that on Friday the border post was thrashed by Palestinians, causing an estimated US$9 million worth of damage. As if to make my point for me, an Israeli news site reported that:

A Palestinian source in Gaza, meanwhile, told Ynet that Hamas has been profiteering considerably as a result of the crossing’s destruction. The Kerem Shalom crossing is operated by the Palestinian Crossings Authority, which is controlled by the Palestinian Authority (PA) rather than Hamas, he noted.

The source then explained that Hamas was encouraging rioters to damage crossings, thereby causing the PA to lose revenue from customs and other taxes levied on incoming goods.

Bringing the goods in through the Rafah border crossing, the source added, will allow Hamas to pocket such tax levies.

The riots over the next few days will distract international news media partially from reporting on the American embassy in Jerusalem. They will help to sow new hatred, both between rival factions and against Israel. They will also ensure that the poverty remains exactly where it is, so that swords are not turned into ploughshares.

Time to blame Israel again?


On the surface, it is that time of year when the Israelis and Palestinians are about to strike up another round in their war of rhetoric. Tomorrow, residents of Gaza are threatening to march on the border fence with Israel. The week has already witnessed a series of illicit border crossings.

And meanwhile, the USA is ready to impose financial sanctions on the Palestinian Authority if it continues to use its budget to support convicted terrorists in Israeli prisons. Sweet news for Israelis, who have been campaigning on this issue for nearly two decades, to the understandable disgust of their opponents.

So, the summer Mediterranean heat is nearly upon us. The politicians are becoming more agitated. The peace process is looking more and more like a stagnant pond.

And yet………

Just over a month ago, the Israeli Minister of Finance, Moshe Kahlon, paid a visit to Ramallah. Press reports indicate that this was his third meeting since June 2017 with the Palestinian Prime Minister, and the next one is planned to take place in Jerusalem. Evidently both Abbas and Netanyahu are fully aware of all the details.

What has been on the agenda?

  1. Setting up a joint industrial zone near Modi’in Illit. Not solely designed for Palestinians, it will also target finding employment for around 2,000 ultra orthodox Jews.
  2. Reaching an understanding so that the tens of thousands of Palestinian labourers in Israel receive full pension rights, which are also paid out accordingly.
  3. Further improvement of the sewage systems, as the polluted drain offs have made its way into Israel.
  4. Improvements to the Palestinian mobile phone infrastructure.

Kahlon is not the only Israeli minister who has visited the Palestinian territories. Eli Cohen, the Minister for the Economy and a colleague in the same political party, has been looking at ways to improve the road system around a Palestinian new city.

I would not leap into the air too much over these moves. However, they do show what can be accomplished when there is good will on both sides. They also reveal the level of nonsense surrounding the public rhetoric of the negotiations from both sides.

This weekend, Jews around the world celebrate the festival of Passover, when Moses led the Jewish people out of Egypt. May senior politicians of both sides find the strength and wisdom to create more such talks, rather than guide their followers towards violence along border fences.

The Palestinian economy has never been large. Advocates of the cause of the Palestinian Authority (PA) have ritually blamed Israeli occupation for the financial woes of the people of the streets of Gaza and Ramallah. The threatened sanctions of the USA this month now force us to confirm the facts hidden behind the rhetoric.

There are two issues that cannot be disputed. The Palestinian economy is tiny compared to that of Israel. Exports in July 2017 were valued at a paltry US$8.1m, primarily to Jordan. And the continuing the struggle with Israel, especially through the use of terror from Gaza, understandably enforces the government of Jerusalem to restrict movement from the Palestinian territories.

Statistically, the economy is contracting again. GDP growth in 2017 was down slightly at 3%, and a further slow down is expected in 2018. There are few positives. West Bank residents have finally been allowed to receive 3G internet services in recent weeks. And overseas aid still plays a primary role is supporting key services. To take just one instance, The British Parliament reported in October 2017 that it funds “around 25,000 young Palestinians to get an education, provides up to 3,700 immunisations for children, and around 185,000 medical consultations annually.”

Therefore, it can only be assumed that if the USA is to cut at least US$100 million of aid to the Palestinians, that will be a significant blow for its social services. What is disturbing is how you have the feeling that the Palestinian economy could be managed so much more effectively and efficiently.

The World Bank long ago confirmed that under Israeli supervision the Palestinian GDP grew annually in real terms by 5.5% even beyond the Oslo Accords. That achievement is long forgotten. And corruption has long been endemic in Palestinian politics has closely documented in previous years by the Funding for Peace Coalition.

The evidence indicates that the pattern of poor financial leadership in Palestinian society has continued up to today:

  1. In 2017 alone, despite their meager funds, the PA under President Abbas paid out over US$350 to Palestinians convicted of crimes of violence against Israelis. The sums vary according to the amount of death caused.
  2. Earlier this month, Israeli customs officials:discovered the largest ever consignment – including thousands of items – of military clothing including vests for holding military equipment. Also seized were thousands of pairs of special military boots and winter jackets in camouflage colors. The Gazan importer of the consignment, which originated in China, was due to receive it via the Kerem Shalom crossing.

    Presumably, Hamas had paid for the goods.

  3. At the same time, we have learned that due to a power struggle between the PA and Hamas, people in Gaza are being forced to pay taxes. This will include the imposition of 17% VAT.
  4. And of course, there is the near-farcical news item earlier this week that “even as the Palestinian Authority faces major funding cuts from the US, it has purchased a new luxurious $50 million private jet to be used by President Mahmoud Abbas.”

I would love to read a serious analysis of how much the Palestinian economy could grow by over 10 years if (a) the struggle against Israel was political rather than a military conflict, and if (b) transparency and accountability could be truly applied.

I have just returned from a visit to a large medical in clinic in Jerusalem. People of all persuasions and languages – pensioners, soldiers, Arabic, English, Hebrew and Russian.

And this started me thinking how some of those in the waiting room might define themselves as Palestinians. Surely there are other areas of cooperation between the sides that the world media just does not allow others to learn about. A quick consultation with Rabbi Google, and I was stunned to learn just how embracing are the joint areas of activity. For example: –

  • Let us start with a practical example of everyday life. A dog sanctuary, located in Beit Sahour near Bethlehem, is often short of resources. A way has been found by the Palestinian Authority (PA) to enable Israeli animal lovers to help out.
  • The Negev desert has seen many projects involving both Israelis and Jordanians. Much of the effort is focused around the Arava Institute For Environmental Studies. With nearly a thousand graduates over two decades, “about 29 percent are Israeli Jewish, and about 24% are Arabs from Israel, Jordan and the Palestinian Territories“.
  • Israel’s scientific partnerships with the EU are well documented. However, I came across this EU sponsored consortium, the SESAME Project – Synchrotron Light for Experimental Science and Applications in the Middle East.

Based in Jordan, it is an independent laboratory formally created under the auspices of UNESCO nearly 15 years ago. The founding members of SESAME include Israel and countries that do and some that don’t have diplomatic relations with each other, including Iran, Bahrain, Cyprus, Egypt, Iran, Jordan, Pakistan and Turkey, as well as the PA.

  • Water has often been a cause of sharp rhetoric for those campaigning against Israel. Last Sunday, “Israel and the PA signed a water cooperation agreement , the fourth major infrastructure deal agreed to in the past year and a half.” Other accords refer to electricity, mobile phones and mail distribution. Significantly, the document on water takes a long term approach, allowing for parallel changes in population for many years to come.
  • And finally, if all of that is a tad too gentle for you, yes, cooperation between Israel and the PA exists over security issues. Maj. Gen. Majid Faraj is the powerful head of President Abbas’ General Intelligence Service. He has also been seen as a potential successor to his octogenarian boss. Interviewed by “Defense News” last year, at the height of tensions with Israel, Faraj confirmed that in previous months “PA intelligence and security forces have prevented 200 attacks against Israelis, confiscated weapons and arrested about 100 Palestinians – claims that were not rejected out of hand.”

The past month has revealed a flood of stories from university campuses in the USA and the UK, where Jewish and Israeli students are physically and verbally abused. This is part of the  BDS campaign to boycott anything remotely resembling a link to the Jewish State.

As I have frequently observed, such a campaign is nothing short of anti-semitic. It is certainly hypocritical because has less to do with Palestinians and more to do with denigrating Israel. And BDS proponents simply lie, because they will not admit that Palestinians – from top leaders down – are also working, very well, with their Israeli counterparts.

Reporting accurately on the Palestinian economy has never been easy. If you look carefully at the documents of the World Bank or the IMF, they often contain statements that data collected from Ramallah and Gaza is not of the most reliable standards. That said, various news items more recently have given the outside world a better understanding as to how revenues are used by the Palestinian Authority and by Hamas.

Why is this important for outsiders? Because according to the OECD, approximately 70% of Palestinian expenditure comes from overseas aid. And the overwhelming majority of that aid comes from the generosity of Western taxpayers, who in turn are suffering from their own economic uncertainties.

The OECD estimates that the Palestinians receive around US$2.5 billion in direct aid annually. Ostensibly, the USA is the largest single donor, but much of UNRWA’s support comes from the pockets of European citizens. 49% of the total sums are designated for ‘other social infrastructure’, whatever that may mean. (BTW, total annual contributions to global aid peak above $130 billion. Thus, per capita, the Palestinians receive a very healthy share of the total pool).

And where specially does this money end up? Here are four quick case studies:

  1. A few weeks ago, I discussed how in spite of the checks in place, monies from the UK and from the EU seep through to political prisoners and terrorists. Coblogger Arnold Roth has expanded on this theme. He believes that “the perpetually financially strapped PA spent $144 million paying salaries” in 2014 alone.  Thus, using the 70% factor, donors (including British taxpayers) paid about US$100m towards helping these ‘deserving people’.
  2. On a similar note, the Palestinian commentator Khaled Abu Toameh observed this week that “The Palestinian Authority has used international funds to build prisons and detention centers in the West Bank where torture has become the norm.” He outlines how the Independent Palestinian Commission for Human Rights (ICHR) has received 782 complaints concerning torture and similar abuses. Again, the money to maintain this state of affairs primarily came from overseas.
  3. Moving away from direct political issues, even culture is not immune to the misuse of funds. The New York Times revealed that a spanking new museum in Ramallah was opened on the basis of a US$24m budget. This is to be a great celebration of Palestinian history and art. However, due to internal wrangling, there is not one exhibit for inspection. So, I am forced to ask, where did the budget disappear to and how was it accounted for in front of the donors?
  4. And there is UNRWA, where the EU is proud to show off its contribution. VP Mogherini announced on 4th April:

Since 2000, EU has provided over EUR 1.6 billion to UNRWA out of the European Neighbourhood Instrument (ENI) allocation for Palestine. The bulk of EU aid for UNRWA, EUR 82 million per year for the period 2014-2016, has gone to finance its General Fund (or  Programme Budget)………On top of this, there are ad hoc temporary projects financed via other instruments. Humanitarian funding to UNRWA amounted to EUR 5 million both in 2015 and 2016 (of which, EUR 4 million for shelter assistance in Gaza)……….

Well that is clear. However, less than a month later, we learnt of an event that took place at the UNRWA refugee camp in Aida, near Bethlehem. This celebrated a violent attack on Israeli buses a few days previously. And it would appear that this abuse of funds is not one isolated party.

I could list other items. For example, Hamas has returned to building offensive tunnels to fight Israel. Such an operation can only be carried out by syphoning off raw materials meant for the reconstruction of the area.

If there is good news it is that more and more of this misuse of Western generosity is being reported. However, sadly, Western governments, the EU and others are failing to take serious action. Meanwhile, the instigators of the verbal and military war against Israel grow richer.

Give aid by all means, but make sure you can check where it is going in a transparent and accountable manner. Otherwise, send it to those who do not just need it but will…………..actually receive it.

My post earlier this week about “UK taxpayers’ contributions to the Palestinians – Who benefits? ” has proven to be very timely.

For example, I noted that the UK government struggles to fund joint cooperation programmes between Israeli and Palestinian groups. I was encouraged to read a news release yesterday from the House of Commons, which confirmed that:

As many as 25 Conservative MPs and Lord Polak CBE have written a joint-letter to the Secretary of State for International Development, Rt. Hon. Justine Greening MP, calling on her Department to consider Israeli NGO Save A Child’s Heart (SACH) for funding support.

The MPs write: “Having seen the work of SACH at the Wolfson Medical Centre first-hand, we believe that further UK Government involvement in this laudable charity would be extremely worthwhile”.

Over 50% of the 4000 children who have received life-saving heart surgery from SACH live in Gaza and the West Bank, with the rest coming from across the developing world. The charity also trains physicians and nurses from these countries, providing them with in-depth postgraduate training.

At a time, when the Daily Mail newspaper and others have highlighted the loose way overseas aid is distributed, supporting SACH could only improve the lives of thousands. More importantly, it will allow Palestinian children and their parents to see how Israel need not be seen as an evil enemy.

However, as I asked in my original piece, why is the UK government not seen to be fully transparent and accountable in its funding of Palestinians? And I stress: The issue is not if the Palestinians deserve assistance, but who receives it. The repeated stories of corruption are numerous. And there is no doubt that Palestinian terrorists and their families benefit from overseas aid.

On the latter subject, Palestinian Media Watch has just released a 15 page report, detailing how both the Palestinian Authority (PA) and the Palestinian Liberation Organisation (PLO) have repeatedly hidden the truth from Western governments. Bluntly speaking, both the PA and the PLO subvert the generosity of Western taxpayers. Millions end up with those who have carried out acts of violence against ordinary civilians!

This has to stop. And one way to do that is to ensure that all UK overseas aid is fully scrutinized. And that includes knowing who the independent auditors are and what is their mode of operandi. Otherwise, the unworthy will get richer. More people will be harmed or worse. And British taxpayers will end up throwing away yet more money.

Over six months has passed since Human Rights Watch (HRW) released an extensive report regarding the use of Palestinian child labour in Israel settlements. It sets out to detail that hundreds of children are employed, usually on farms, sometimes under aged, and frequently for miserable amounts of money. If correct, this is wrong. The analysis still triggers questions in the European, British and other Parliaments.

NGO Monitor has regularly pointed out the disproportionality of HRW’s work when it comes to Israel. In this specific case, the group rightly questions the methodology as well as the transparency of the evidence supplied. Reading the  HRW report, the flaws are obvious to even the untrained eye.

But what about those Palestinian children?

First, let us assume that there is just one Palestinian child abused on just one farm. That is one too many. However, as the report admits, Israeli child law is based on international law. Instead of investing millions in creating a 70 page document – of which over 50% seems to focus on the minutiae of irrelevant international law and not the children – and in order to obtain justice, HRW merely needed to ensure that prosecution lawyers were found – again assuming the allegations are truthful.

It would seem that HRW is not actually interested in the children per se. And for the record, HRW did not discuss the possibility of Jewish kids working on the farms – a point which I find abhorrently selective.

Second, and in my view more relevant, why is stronger criticism not thrown at the Palestinian middlemen, who reportedly connect the children with potential employers. If the kids need to work, why do the not place them with Palestinian businesses and farms?

Also lacking here is equivalency. There is no parallel HRW report of such Palestinian employees. Yet, if you surf the internet carefully, you will find documented incidences of how these children are exploited by their own community leaders.

The ‘need to work’ then prompts the issue of the Palestinian economy itself. We know that since the Oslo Accords of 1994, the Israeli economy has doubled in size. Yet, as asked by leading academic Moshe Elad, what have the Palestinians done to develop their own economy? Yes, the IMF has confirmed that the Palestinian economy grew annually by 5.5% for three decades since 1967 under Israeli supervision. However,

In other words, what can be left for the average Palestinian business owner in order to employ adults or even teenagers? Wages in the Palestinians territories are clearly so poor that it is the key factor why every day tens of thousands of Palestinians flock to work inside Israel, and this includes people under the age of eighteen. And as for the practices of good social government and the protection of children by the regimes in Ramallah and in Gaza, forget it!

Israel has often claimed that Palestinian children have been used as human shields in the fields of battle. That is against the Geneva Convention. But these youngsters have also become pawns in the battle for Western media and the opinions of decision makers.

The true winner in this  debate is ‘reverse psychology’. The Palestinian children are abused. The real criminals are shouting, pouring bile and blame in the direction of Israel. This rhetoric merely serves as a convenient cover for their own sins. The HRW was blind enough to lap it all up. And you now know who has lost out? The abused themselves.

As Palestinians and Israelis sink into another tragic round of reciprocal violence, the micro economies of each sector are also taking a direct hit. Small traders in the centre of Jerusalem or Nablus, providers of tourist services, businesses looking for investment, etc, – with some irony, there are similar effects on both sides of the divide

The Palestinians often claim that Israel can absorb the financial downside, as it has a larger economy. Maybe, but I am not sure why this is a justification for violence. And surely traders should want to protect their precious sources of revenue rather than support violence that destroys such wealth.

Palestinians and their advocates will also point to the weak base of the Palestinian economy, which has become a spark for much of the new troubles this month. There is a wealth of documents, detailing how the economy in Gaza and the West Bank continues to worsen.

But again, some of the murderers of Israelis have come from reasonable social backgrounds. To be blunt, there are many poorer regions in the world, and their inhabitants are not throwing rocks at innocent children and women in protest.

So, I must assume that the Palestinians are rejecting a perceived lack of hope. It is that damn occupation that is causing the desperation. Maybe, until along comes two little known facts, hidden away from the view of CNN, New York Times, the Guardian et al.

First, the Israelis often complain that the Palestinian leadership has been tainted – no, ridden – with corruption. For example, just look at how the widow of Chairman Arafat, Suha, lives in luxurious exile. More recently, there have been a series of leaked documents re Palestinian corruption, reportedly outlining rape and severe financial wrong doings at high levels of the Ramallah government.

And into this arena has jumped the respected magazine, “The Economist’, not usually noted as a friend of Israel. The editorial wondered how long it will be before locals reject the continuing “extravagance and graft in Ramallah“.

The Palestinian Authority (PA), the limited self-governing body in the occupied territories, has been plagued by waste, graft and accusations of both since its inception in 1994 following the Oslo accords. When auditors looked at the books three years later, they concluded that nearly 40% of the budget had been frittered away.

Second, and here is a genuine surprise for Palestinian economy, “a joint study by the Palestinian Central Bureau of Statistics (PCBS) and the Palestine Monetary Authority (PMA) ….. has revealed that the Palestinian economy’s investment outside Palestine outweighs investment in Palestine from abroad by the end of Second quarter of 2015.”

To clarify for the non-economists: The Palestinian economy of its various sectors had invested outside Palestinian territory by more than the investment amount in the Palestinian territory from abroad to the tune of US$1,254 million. And if I can remind my readers – that is just what is recorded…officially!

So you have to wonder. If much of this money was left in ‘Palestine’, theoretically available for use on behalf of that nebulous average man on the street, how much of this current violence would still be taking place……….and which continues to destabilise the economies of all?

This time last year, Israel was fighting a bloody conflict in Gaza with the people’s’ army of Hamas. Around 2,200 lost their lives, primarily on the Palestinian side. While Israel’s economy took a blow, those on the West Bank were left relatively untouched.

We have been reminded of these sad events in the past few days. As memorial services have been held in Israel, international journalists like Jon Snow from the UK flocked back to Gaza to report what has – or has not – been repaired. And a small flotilla tried to beat Israel’s naval surveillance of Gaza, although it was stopped before reaching its destination. (It was later reported that the only provisions for Gaza was a small box of medical supplies that would have been cheaper and simpler to send by express mail!).

So how can the Palestinians be helped? Compared to a decade ago, the number of roadblocks in the West Bank are minimal. While Israel has left Gaza, those who thought that life would be better, the “disengagement has backfired badly.”

And last week, we witnessed the most absurd report. Palestinian workers are going to the courts of the Palestinian Authority in order to secure the same fair treatment that they would have received under Israeli labour law.

Help from elsewhere? With some ironic timing, I was handed a pamphlet, prepared by UNSCO on behalf of UNCT in June 2013. Entitled “The United Nations in Palestine”, it details 25 – I repeat twenty five – UN based organisations that are involved in supporting Palestinians in an on-going manner. ILO/ OCHA / UNDSS / UNFPA / UNROD etc, etc. And remember, most of this is paid for by the generosity of Western tax payers.

Their combined budget for the Palestinian issue alone? I have no idea. However, as I have often cited, UNRWA’s annual finances alone stretch to over one billion dollars. As politicians and diplomats close their eyes, there are no independent audits to verify transparency and accountability of this monolith.

From the Israeli side, there is no humanitarian crisis in Gaza. Speak to soldiers in COGAT and you will be informed that even if the economy is fragile, the residents of Gaza are not starving. In fact, Israel has ensured that the volume of goods entering Gaza has doubled in 2015. Who receives them and on what basis? Well, that is a different question. I suppose much can be said about the resources dripping down the various UN groupings.

On a highly pertinent side note, what also emerged this week is that there are around 18,000 civilians, mainly Palestinians from Syria, who are trapped in a pathetic refugee camp near Yarmouk. About 3,500 are children. International rescue efforts are simply not on the horizon. Yet the UN did release its report on the 2014 war, which heavily criticized Israel’s use of force in defending itself. There seems to be a disproportion here.

What is truly sad for me is that the main Palestinian crisis is one that has been cutting through the Middle East for decades and remains unresolved. There has never been a leadership that has placed nation-building above its hatred of Israel……and its parallel desire for the good life. And that is the key lesson we can take away, a year after that wasteful and tragic war in Gaza.

Yes, the overwhelming majority of Israelis have supported the war in Gaza. Even bastions of opposition to government policies in the West Bank, such as internationally celebrated author Amos Oz, gave an unequivocal thumbs up.

And yes, Israelis do not understand why they have annoyed many of the world’s diplomats and politicians, who reject such actions. Can the two views be justified?

On the one hand, hundreds of lethal rockets have been lobbied callously into Israel every year from Gaza, and the world kept silent. The Hamas fire prior to Israel’s response had yet again turned tens of thousands into refugees. Using aid given as charity, Hamas has dug dozens of threatening tunnels under the homes of kibbutzim and other civilians. This netherworld has been furnished with weapons, chloroform, and even motorbikes – all to be used to kill, kidnap and maim – yet that is seen as a casus belli by Israel’s opponents.

However, when Hamas broke a UN-sponsored ceasefire last Friday with a murderous and premeditated act, the primary concern of Philip Hammond, the British Foreign Minister, was the plight of the poor Palestinians as opposed to Israelis blown to pieces (literally). Israeli society just does not get it. As I quipped previously on Facebook, the world appears interested in peace in Gaza – fair enough – but few are concerned about peace for Israelis.

Moving forwards and now that the fighting has ceased (for the moment), are neutral observers that interested why and how Israel believes that it went above and beyond the letter of international law in order to protect innocents during the fighting? The points below are not extensive, but I was warned how they might be interpreted as repetitive and even patronizing.

And so the list goes on. Israel can justifiably pat itself on the back for its past achievements. Israel in 1948 was a country of refugees and today is a member of the OECD. Gazans consider themselves to be refugees, yet their rulers invest in teaching hatred and destruction, a tasteless recipe for poverty. Hamas main building project has been the construction of tunnels to attack and then murder its neighbours.

And yet most of Israel’s 8 million citizens do not understand why the neutral observer and many world leaders do not buy into their arguments. How else, they cry, can you defend yourself against Hamas, dedicated to the violent destruction of a Jewish-based democracy, protected by human shields?

This international rejection was driven home on Sunday. When it seemed that Israel had bombed a school and killed children, the international media rushed to cajole global leaders into condemning the Israeli military……..even though much of the story is turning out to be a sick and cynical hoax!

Similarly, in an interview on Channel 4, seasoned British reporter Jon Snow repeatedly challenged the Israeli ambassador to the UK as to when the killings will stop. The denigrating implication is that Israel is responsible for the deaths. What Mr Snow managed to forget was that Hamas had flagrantly broken six ceasefires.

And during the conflict, Israeli newspapers observed how ‘the neutrals’ have responded to news elsewhere in the world.  Planes have been downed around the globe; ancient Christian communities have been wiped out; ISIS slaughtered children in Iraq; a few more thousand Syrians have perished, as thousands of others face torture. These are terrible acts, but the world, the UN and Ban Ki Moon have not been forced to move too far out of their comfort zone…. except when it comes to Gaza.

In an interesting anecdote on Al-Jazeera television, Israel’s Minister of Economics was interviewed. He explained that it comes down to: “Do I let Hamas kill my mother or do I take pre-emptive action?”. What characterizes this conflict from Syria and others is that Israel has fought back, without waiting for permission. And it is this proficiency that acts as an embarrassing projector on the inabilities of Hammond, Moon et al.

I offer that Israeli society should learn to accept that neutrals are not anti-Israel, yet they are driven by two intertwined considerations, which count against the Jewish State.

First, when the world sees pictures on destruction on their TV screens, the revulsion about tunnels and rockets and the facts of Hamas using human shields all become redundant. Blown up buildings imply de facto that Israel has not reacted ‘proportionally’. Such images do not appeal to a sense of fair play. In England, it is not cricket.

(For the record, it must be stated that many homes were destroyed and innocents lost their lives. This is not the place to drown in an argument over stats. However, it must also be stressed that Hamas fought the war in built up areas, as per their manual.)

So what is allowed, proportionally? Apparently 2 million poor Gazans can attack 8 million Israelis. Or as Rabbi Ari Kahn observed, Israel was encouraged to release over 1,000 Palestinians in return for Gilad Shalit. And David Miliband, leader of the British socialists, argues that Israel has his backing to defend itself, so long as Gaza is not attacked, whatever that may mean.

The true disconnect of the proportionality debate is that it is designed to force Israel to accept current UN standards, which demand …..… inaction. Proportionality is a baseless and malicious argument because its proponents fail to explain what Israel can do to ensure Hamas ceases to launch rockets from built up citizen areas. (And yes, that is a war crime in itself, yet ignored).

The other consideration about neutrals brings me to an interesting discussion on CNN led by Wolf Blitzer, who asked why the international media seem to target Israel. The BBC is a great example. (For the record, It is estimated that over 700 journalists form 42 countries entered Israel to cover the war, doubling the current high entourage.)

The CNN panel concluded that the ‘world expects more or better’ from Israel.  Enough said, no?

No! Better than what? Than Hamas? Of course not, because there are no expectations about those naughty people. OK. Better than how the West has performed in the Middle East? Well, a thousand kids have been killed in Afghanistan so far in 2014.  Or more moral than South Africa, whose countryperson is the UN High Commissioner for Human Rights.?  There, the abomination of rape is now an accepted instance of life, and commonly practiced by the teaching profession.

Israelis are livid. There is mounting evidence that Hamas bludgeons reporters into silence. Witness the features from Italian and other correspondents. So-called massacres in Sejaiyah have been miserably misreported. Networks like the BBC so rarely show Hamas soldiers in uniform. France24 has taken off its website a video showing the launch of a Kassam missile from the al-Shifa hospital, where the Hamas high command is encamped.

I think that the phrase ‘expecting more’ has the same function as ‘proportionality’. It is a polite way for the world to ask Israel to shut up. Politicians, diplomats, intellects and journalists around the globe are demanding that Israel does not force them to analyse some their own moral inadequacies.

So maybe I started out from the wrong premise. It is not really a case of what Israeli society does not understand about the world. More poignantly, it is time to consider what the world does not want to comprehend about Gaza. Just because Hamas operates with halo of the underdog, the biblical David,  that in itself does not automatically mean it has ‘right’ on its side

In effect what Israel has done in the past three weeks is to force the so-called leaders of the world to ask what they would have done if they had been in her shoes. And that change in the way of thinking, just like many other changes in life, is very difficult to accept. And the consequences of that new opening are not too easy to digest.

An outsider looking in on the Middle East must be wondering why Israel and Hamas are fighting a war over a series of tunnels. After all, if Gaza is so poor, as its supporters maintain, how could they afford to build such a network?

It is an open secret that for at least a decade how the tunnel economy has funded Hamas, even before it came to power. Before Egypt shut down the Sinai side of the operations last year and sealed up its side of the border, it is estimated that via taxes and sales the trade was valued in billions for the Hamas exchequer.

So how much does it cost to build a tunnel?

I have already cited Doron Peskin last week. Yesterday, writing in Hebrew, he estimated that one meter costs about US$200, and tunneling work can achieve about 20 meters per day. The cement used to be smuggled through from Egypt. More recently, it has come in ‘regular’ lorry-loads via Israel. Since 2011, Qatar has replaced Iran as the prime paymaster.

Israeli reserve Col.Miri Eisen – former deputy head of IDF’s combat intelligence corps and former assistant to the director of Military intelligence, commented in an interview: –

It is a lucrative economic job in the Hamas. It is their top-tier unit, which is called the tunneling unit. They have put an enormous amount of money when they saw that the tunneling itself was something which Israel has intelligence challenges in finding the tunnels themselves while they’re building them. They put an immense amount of money and effort. They put the best into the tunneling units. They’ve built tunnels from the Gaza Strip into Israel that are a mile, a mile and a half, a mile and 800…I mean incredibly long tunnels and we’re not talking about a little mole tunnel which is dug and a person goes through like in [Shawshank] Redemption… We are talking about tunnels that are done in the tunneling mode, the way you would build nowadays trains, roads, anything that goes underground into a mountain. They are tunneling out, they are using their money, their capabilities, with little Caterpillar tractors that go in and dig out the dirt, covering it with an enormous amount of cement, and you’re all aware of the issue of cement going into the Gaza Strip.

However, in economics, for every cost, there is an alternative cost. In other words, if you can spend on X, that means you did not invest in Y. And therefore, those needed the benefits of Y lose out.

I have no idea how many tunnels exist in Gaza or how long they are. The IDF claims that it has already found 13. So, let’s assume conservatively there are only 20 in total and each one is 2 kilometers long. By my wobbly maths, that is close to a US$100m investment. The alternatives?

Point 1: 13 tunnels may have been found so far. There is no record of a one public bomb shelter being discovered in Gaza. In contrast, history has forced Israel to build one in every one of its homes in order to protect its citizens.

Point 2: BBC journalists and others decry the lack of medical services in Gaza. Now this is compounded by Hamas fighters using ambulances for transport. On the other hand, how is it possible that Israel has managed to establish a field hospital for Gazan citizens during the battles (as it has done for Syrians), while Hamas officialdom is nowhere in sight?

Point 3: Hamas relies on UNRWA to provide a schooling system. And yet the facilities are abused to store weapons. (I understand that UNRWA has since returned the equipment to the government)

The war could have been avoided. As Egypt’s foreign minister said last week: “Had Hamas accepted the Egyptian (ceasefire) proposal, it could have saved the lives of at least 40 Palestinians.”

The pathetic reality is that while Hamas leaders are safely closeted in the tunnels that they have erected for their own means, far more than 40 lives have been lost. The true cost of the Gaza tunnel network, for both sides of the diplomatic divide, has to be measured in terms of emotional loss, a horribly unnecessary evil.

Why has Europe begun to question its role in the Palestinian financial system?

recent diplomatic conference highlighted the problems of the Palestinian economy; strikescorruptionhigh unemployment, and more. The event was hosted in Prague and since  1991, the European Union – through its taxpayers – has been arguably the principal monetary supporter of the Palestinian territories, directly and through organization such as UNRWA.

The flow of these billions is set to continue, at least to the end of the decade. Yet throughout this period, there have always been three key ‘misfits’, enveloping these subsidies.

  1. Why has the Palestinian cause earned such large fiscal attention, when others in Africa and elsewhere have missed out? It is a decade ago since Nigel Roberts, former ranking World Bank representative in the region surmised global financial support for Palestinians as “the highest per capita aid transfer in the history of foreign aid anywhere”.
  2. Why has the Arab League, for all its wealth, never matched the contributions of the Europeans?
  3. Why is Palestinian poverty highlighted and blamed solely on the Israelis, when a World Bank report noted that the Palestinian economy grew under Israeli control by 5.5% annually up to 1999? That is a phenomenal performance, absolutely and relatively.

Something does not add up.

Back in 2003, the European Union investigated claims of fraudulent use of its resources by the Palestinians. The report under Christopher Patten was never released. (Interestingly, Patten went on to run the BBC and was famed for burying reports there). In parallel, The Funding for Peace Coalition was active for many years on these same issues. As the website poses: Where has all this money disappeared to?

These are contribution paid for by farmers in Greece, small businesses in Germany or even the owner of a pub in Putney, London What has been achieved through their generosity? Specifically, as Alarabiya News questioned regarding Suha Arafat, how did the wife of the former Palestinian Chairman amass such wealth? Should people be concerned? I believe so and for three separate reasons:

First, it is an issue of good governance. A taxpayer expects his representative to take responsibility. He has a fundamental right to know where his money ends up and that it is for a reasonable purpose. It is difficult to find any other subject, where such sums – billions – were and still are transferred with relatively little transparency and accountability.

Second, as reported above, there are a lot of poor Palestinians. No argument. They deserve better. It is staggering to consider that the financial transfers from the European Union have not made a more lasting and significant positive contribution on the Palestinian economy. It is even more amazing when you compare this failure to the World Bank analysis, noted above, about how the economy had previously leapt forward when Israel had full control of the territories.

Third, there is considerable evidence, which suggests that not only have funds been diverted for the benefit of an autocracy, both in Hamas and in the Palestinian Authority. Monies have ended up in the hands of terrorists. As admitted in the House of Commons in London, by a minister at the Foreign Office, Mr Hugh Robertson, “UK officials raised the issue of payments to Palestinian prisoners in Israeli jails with the Palestinian Authority (PA) most recently in March 2014. The International Development Committee also received information on this issue from the Minister of Finance during their visit in March.” In the same vein and possibly even more bewildering was the question raised in the European Parliament by Michal Kaminski.

It is a well-known fact that the Palestinian Authority proudly owns up to illegally spending over 6% of its budget — donated by, among others, the EU, where funding terrorism is against the law — on salaries for terrorists in Israeli prisons and pensions for the families of suicide bombers. The Palestinian Prisoner Affairs Minister, Issa Qarake, has admitted on television that the salaries are directly proportional to the terrorists’ sentences and the number of Jews they have killed……What is the Commission’s strategy to stop EU funds being used to pay salaries to terrorists in Israeli prisons?

And the response:

The EU is aware that the Palestinian Authority has a system of allowances in place for Palestinian prisoners, their families and ex-detainees. This scheme is not and has never been financed by the EU.

Maybe………..BUT how did the PA have enough money in the first place to distribute such payments?

For the record, there is also growing disapproval of some of the actions of UNRWA, to which Europe pays hundreds of millions of Euros annually. Not only does this billion dollar organisation have no external auditing procedures. It prints and distributes textbooks in its schools that appear to promote violent incitement against Israelis.

So where to now? The current round of peace talks is precariously balanced. The Palestinians are fuming about the non-release of terrorists by Israelis. In turn, Jerusalem feels that President Abbas has deliberately instigated the crisis, just like at the beginning of the Intifada in 2000. In response, Prime Minister Netanyahu is forcing the Ramallah government to pay up on extensive debts, which sounds ironic in light of the above discussion.

There is some hope. On the ground, individual Palestinian entrepreneurs are trying to work with Israelis. And Israel is actively seeking to open up commerce for its Arab population. It is also very welcome to see the read of the approach of Michael Theurer, chairman of the European Parliament’s Committee on Budgetary Control. Writing in the Wall Street Journal, he observed how in December 2013,”the European Court of Auditors revealed major dysfunctions in the management of EU financial support to the Palestinian Authority, and called for a serious overhaul of the funding mechanism.” He continued:

The report from the European Court of Auditors is a wake-up call on the need for stricter supervision of how EU funding to the Palestinian Authority is spent……A useful next step would be the imposition of clear benchmarks and conditions that the Palestinian Authority would have to meet in order to receive additional EU funds. These should include improving the state of human rights in the West Bank, cracking down on corruption and cutting off subsidies to convicted Palestinian terrorists.

Until then? The sad fact is that as long as Palestinian and European decision makers remain safely ensconced on their hilltops in Ramallah and in Brussels, Palestinian and Israeli civilians alike will continue to suffer, as will the bank accounts of European taxpayers.

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