In economic and political theory, there is a long list of classical liberal thinkers who have argued throughout the centuries that economic cooperation and economic growth have the power to positively influence political relations between countries. Many leaders around the world have adopted this doctrine as part of their political platform and policy agenda, including Benjamin Netanyahu and the Likud party. An examination of Netanyahu’s statements as opposition leader at the Herzliya Conference back in 2008 demonstrates the foundations of Netanyahu’s notion of “economic peace” with the Palestinians.
In his speech Netanyahu called economic peace “A corridor for reaching political solutions.” According to the prime minister, there is ample evidence of situations where the advancement of economic issues contributed to paving the way for political peace between two rival parties. Furthermore, he noted that “The economic reality in the West Bank may lead people to feel that they have nothing to lose – and from here the road to terror is short. True, this does not solve the problem of national aspirations, but it should enable us to reach a dialogue on national aspirations under a better situation.”
Since this speech in 2008 Netanyahu has succeeded in being elected three times as prime minister, yet not much has been done to promote his idea of “economic peace” and the situation seems to have gotten worse. The market of political ideas has completely dried up and Gaza has since become a ticking time bomb of humanitarian crisis. If Netanyahu feels so strongly that economic incentives can lead the other side to abandon terrorism and violence, why has the idea of economic peace been abandoned when it comes to Gaza?
A few years back, Likud Minister Israel Katz initiated an ambitious idea of building an artificial island along the coast of Gaza. According to Katz’s outline, the island would include a port, an airport, and infrastructure facilities for energy and water desalination. The island would be connected to the Gaza beaches by a five kilometer bridge from which Israeli security checkpoints will operate. The Idea came up as a solution for the siege on Gaza and as a final step to complete the disengagement. Katz claims that “The disengagement did not really happen” and argues that “we can tell ourselves that we are not legally responsible for what is happening in Gaza, but that is not true. The responsibility for a humanitarian crisis of two million people living there will be imposed on us.”
The island is supposed to help remove the suffocating siege on Gaza and lead the Palestinian enclave towards economic development while also allowing Israel to continue monitoring what comes in and out of the Strip. The continuation of Israeli supervision along with huge investments will give employment to tens of thousands of people and thus help Gaza flourish in a way that will make terrorism seem less attractive. This is a way to lift the blockade in a controlled and supervised manner that has the potential to create growth and a sense of progress that the residents of Gaza and the Hamas regime will not be quick to endanger.
Katz estimates that the cost of building the island will be $5 billion USD, and that raising the money will not be an issue: private international companies would set up the port and operate it, in addition to the infrastructure, power plants, and desalination plants. The second source of funding would be donor countries that recognize the importance of the economic and humanitarian project. The ownership of the island will be international, as well as the police forces on it.
Like the disengagement from Gaza, the construction of this project can also be seen as a one-sided move. In other words, Hamas and the residents of Gaza are supposed to be its main beneficiaries, but the plan does not require their consent and does not give them ownership of the island. But the problem right now is not necessarily the risk of cooperation with the Hamas but more the Israeli government itself, which keeps pushing the idea aside. There seems to be broad support for the idea in the government and in the IDF, so who are the main opponents? Defense Minister Avigdor Lieberman, whose uncompromising approach opposes giving Hamas any kind of inducements, especially after promising to ruin the Islamist regime, and Prime Minister Netanyahu, who has remained neutral on the issue, probably because he prefers not to give Katz, a perceived political rival, any kind of political advantage.
Evidently, political self-interest has taken over the Israeli leadership. But they are not the only ones to blame. It seems that cynicism has taken over the population, which remains indifferent. The notion of not having a peace partner has penetrated strongly, along with the lack of any hope for a political settlement. Even if a peace deal with Hamas is out of the question it doesn’t exempt Israel from making any kind of decision or from having a proactive approach. The time is now for creative ideas and purposeful actions that have the potential to slowly ease Israel and Palestine towards a sustainable deal. Economic peace via Katz’s artificial island is just one step towards a political agreement. It does not solve the problem of national aspirations, but it can help push us just a little bit closer to the much-needed dialogue between the two sides.
To read more about proposals for Gaza transit infrastructure, including an artificial island, check out Israel Policy Forum’s 50 Steps Before The Deal initiative, Step 27: Develop Air and Sea Transit Infrastructure for Gaza.