Notes and References

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Because of the urgency of the situation, the zone would start in Egypt and expand into Rafah. Workers would mainly come from Gaza. Management of the zone would initially be shared. See below.
Development of a roll-on, roll-off facility would precede completion of the full-service port.
see: The reports on Rafah and Khan Younis published by the Palestinian Ministry of Planning and International Cooperation in cooperation with the UNDP, “Palestinian Participatory Poverty Assessment Project,” (PPPAP) ( February-March 2002): www.pppap.org/what/district/index.html.
The Aix Group, “Economic Road Map: An Israeli-Palestinian Perspective on Permanent Status” (January 2004): www.peres-center.org/pages/projects_content.asp?iGlobalVarId=117. See annex.
James D. Wolfensohn, “Forward,” The World Bank, “Disengagement, the Palestinian Economy and the Settlements,” (June 23, 2004): www.worldbank.org/ps. In a survey carried out in 2003 in Rafah by the Gaza Community Mental Health Program, 66% of the 994 children surveyed, aged 10-19, when asked about ways of coping with their situation, said they would concentrate on their schooling – but 24.7% said they would like to be ‘martyrs’. Prevalence of PTSD among PalestinianChildren in the Gaza Strip, European Child and Adolescents Psychiatry Journal, April 2003. Cited in Ibid., 35.
Yamit was evacuated by Israel as part of the 1978 Camp David Accords. The buildings were destroyed by Israel as part of the withdrawal. Yamit could be utilized as headquarters for the first phase of construction.
We believe that the difficulties of establishing a joint, or trans-boundary, free industrial zone are outweighed by important benefits, especially at the outset of the project. See below.
A training center in the West Bank should also be considered—especially if safe passage is established under Phase Three.
Among other things, this would require agreement with Egypt on the unimpeded movement of goods in bond to Egyptian ports. For problems associated with moving cargo through Egypt see: “Transit Trade and Maritime Transport Facilitation for the Rehabilitation and Development of the Palestinian Economy,” UNCTAD, 2003.
Ilan Nachson, “Note the price, please,” (December 14, 2003): www.globes.co.il. The critical importance of security to attract private investors was a key conclusion reached at the Center for Macro Projects and Diplomacy Conference on “New Land” for Peace in April 2004.
Haaretz (June 8, 2004): www.haaretzdaily.com.
US AID reported that some 880-890 Palestinians were employed at the GIE in October 2002, of whom 150 worked as a sub-contractor to Kitan, an Israeli manufacturer of sheets and towels. US AID West Bank and Gaza Mission, “Update on the Gaza Industrial Estate,” Mission Headlines (October 21, 2002): www.usaid.gov/wbg/headline_66.htm. In contrast, the project target was job creation for some 50,000 people in 1987 (20,000 direct and 30,000 indirect jobs.) World Bank, Private Sector Development and Finance Group, Middle East and North Africa Region, “Project Appraisal Document for a Proposed Trust Fund Credit in the Amount of US $10.0 Million Equivalent to the West Bank and Gaza for the Gaza Industrial Estate Project,” Report No: 17204 GZ (Washington: World Bank, December 10, 1997), 2: www.worldbank.org/ps. The GIE is discussed in more detail below.
It is clear that Israel will remain the Palestinians’ principal trading partner for the foreseeable future. The point is that development of an independent export base would be very desirable from both a Palestinian and an Israeli perspective. In this regard, it should also be noted that the expressed intent of the Sharon Government is “to reduce the number of Palestinian workers entering Israel, and eventually to completely stop their entrance.” Israeli Cabinet Decision on Disengagement, June 6, 2004. See annex. For the Economic Road Map: The Aix Group, “Economic Road Map: An Israeli-Palestinian Perspective on Permanent Status” (January 2004), 27: www.peres-center.org/pages/projects_content.asp?iGlobalVarId=117.
These operate under the Egyptian Government’s General Authority for Investment and Free Trade Zones: www.gafinet.org/docs/profile.htm
The Palestinians do have experience with industrial zones (albeit ones entirely dependent on Israel)—and much progress has been made by the Palestinians over the past ten years with respect to the establishment of the necessary legal, judicial and regulatory system, although much more still needs to be done in this area. The GIE is run by the private holding company, Palestine Development & Investment Ltd. (PADICO): www.padico.com/index.htm. Governmental control is exercised by the Palestinian Industrial Estates and Free Zones Authority (PIEFZA): www.piefza.org. See below for discussion.
Israeli Cabinet Decision on Disengagement, June 6, 2004. See annex. Our proposal is to the north of this.
Al Mawasi is a narrow strip of coastal land located in the Southern Gaza Strip along the Mediterranean coast from the Egyptian border to Deir El Balah. It has two separate areas of administration; Al Mawasi Rafah located to the west of the city of Rafah and Al Mawasi Khan Younis located to the west of the city of Khan Younis. All but about 3 linear Km of coastline falls within Khan Younis. According to the Oslo accords, Al-Mawasi area was classified as a yellow area placing it under Israeli security control, but under Palestinian civil jurisdiction.
The World Bank, “Disengagement, the Palestinian Economy and the Settlements,” (June 23, 2004): www.worldbank.org/ps, 9.
For more information on the Sheikh Ejleen port, South West of Gaza City, see: “Gaza Seaport Project,” Palestinian National Information Centre: www.pnic.gov.ps/english/transportation/sea.html. Construction of the port was a French-Dutch project. The site was bombed by Israel on September 17, 2001.
The World Bank, “Disengagement, the Palestinian Economy and the Settlements,” (June 23, 2004): www.worldbank.org/ps, 29.
For a useful technical study of the Gaza Coast see: Dr. Mahmoud Ali, “The Coastal Zone of Gaza strip-Palestine Management and Problems.”
Secure rail seems the best solution to connect Gaza and the West Bank. Other transportation modes, however, will be considered in the feasibility study.
The World Bank, “Disengagement, the Palestinian Economy and the Settlements,” (June 23, 2004): www.worldbank.org/ps, 28.
Such projects might include desert reclamation in the Halutza sand region, an area which might be made available to the Palestinians as part of a comprehensive peace; this, as part of an overall effort to meet the demands of a “right of return” for Palestinian refugees. Similarly, shares in certain pieces of this macro project might be used to “compensate” Palestinian refugees.
“The population as a whole has reduced its per capita food consumption by 30-35% since 1999, and were it not for donor assistance (food aid having increased five-fold since 2000), malnutrition would be at levels associated with much poorer countries.” The World Bank, “Disengagement, the Palestinian Economy and the Settlements,” (June 23, 2004): www.worldbank.org/ps, 3. Easing Palestinian “food insecurity” is consistent with Target 2, UN Millennium Development Goals.
Palestinian Central Bureau of Statistics: www.pcbs.org/.
The planned closure of Erez—the relocation of its industrial facilities and the loss of at least 4,000 additional Palestinian jobs—was announced by Ehud Olmert, Israel’s Industry, Trade and Employment Minister, on June 8, 2004. Haaretz (June 8, 2004): www.haaretzdaily.com.
According to the World Bank, GDP for both Gaza and the West Bank declined by almost 40% between September 2000 and the end of 2002. The economy stabilized in 2003 but “possesses little vitality.” The stabilization is not likely to be sustained. The World Bank, “Disengagement, the Palestinian Economy and the Settlements,” (June 23, 2004): www.worldbank.org/ps, 1-2.
Ibid., iv. The Bank’s main point in this study is that if disengagement is done without opening internal closures, etc., the Gaza Poverty Rate will remain at 72%.
Ministry of Planning and International Cooperation (MOPIC) in cooperation with the UNDP, “Report on Rafah District,” Palestinian Participatory Poverty Assessment Project (PPPAP) A(March 2002), 37: http://www.pppap.org/what/district/pdf/PPA-Rafah.pdf.
For the PPAP reports for Khan Younis and the rest of Gaza: www.pppap.org/what/district/index.html.
See: “PM: My plan will force Palestinians to give up dreams for years,” (April 5, 2004): www.haaretzdaily.com.
Although it is interesting to note that the number of legal foreign workers in Israel has dropped from 93,700 in September 2002 to 62,700 in the first quarter of 2004—most dramatically in the construction sector-- indicating the demand for Palestinian workers in Israel is increasing. Globes [online] (June 8, 2004): www.globes.co.il.
The Aix Group, “Economic Road Map: An Israeli-Palestinian Perspective on Permanent Status” (January 2004): www.peres-center.org/pages/projects_content.asp?iGlobalVarId=117.
In a phased withdrawal requiring separate votes by the government for each stage of the withdrawal to be implemented. There is some ambiguity with respect to completion of the withdrawal.
“Daily suffering of Al Mawasi residents,” Applied Research Institute Jerusalem (February 10, 2003): www.poica.org/casestudies/Al%20Mawasi%2010-02-2004/.
This number is based on an earlier study which envisioned a 5-10 square Km site costing US $200-300 million. The smaller GIE – not a trans-boundary site -- was estimated by the World Bank at US $84.5 million in 1997. World Bank, “Project Appraisal Document for a Proposed Trust Fund Credit in the Amount of US $10.0 Million Equivalent to the West Bank and Gaza for the Gaza Industrial Estate Project,” Report No: 17204 GZ (Washington: World Bank, December 10, 1997), 2: www.worldbank.org/ps.
Wolfensohn, “Foreword,” The World Bank, “Disengagement, the Palestinian Economy and the Settlements,” (June 23, 2004): www.worldbank.org/ps.
For example: Khaled Amayreh, “Step One,” Al-Ahram Weekly On-line, No. 695 (17 - 23 June 2004): http://weekly.ahram.org.eg/2004/695/re3.htm. Amayreh reports that “A consensus is growing among Palestinians about the positive merits of a crystallizing Egyptian involvement in effecting the proposed Israeli withdrawal from the Gaza Strip.”
About half of the companies located at Erez are Palestinian-owned. However, they account for less than one-fifth of the jobs there. This figure is derived from reports of the employment impact of the planned Israeli evacuation of Erez.
The World Bank, “Disengagement, the Palestinian Economy and the Settlements,” (June 23, 2004): www.worldbank.org/ps, 11. For PADICO see: www.padico.com/index.htm. For the Palestinian Industrial Estates and Free Zones Law see: www.piefza.org.
See: Ibid.
See below for the Egyptian models for “Public Free Zones” and “Private Free Zones.”
For a 1999 study of potential investors in Palestinian industrial estates see: Sheri Pitigala
Can Tutuncu, The Services Group, Inc., “Investor Targeting Strategy for Industrial Estates in the West Bank and Gaza,” USAID Contract No. 294-C-00-98-00110-00 (Washington: USAID, November 1999): Data base at: http://library.info.usaid.gov/.
The following is from: The Arab Republic of Egypt, General Authority for Investment and Free Trade Zones: Egyptian International Trade Point, Ministry of Foreign Trade and Industry: www.tpegypt.gov.eg/Trade-info/freezone10.asp.
www.amcham.org.eg/BSAC?studiesseries/report27.asp
For example, government or a public entity could over time sell the land at a premium and establish significant tax and other revenue-earning potentials without much if any financial exposure. Some modification of Law 83-2002 would be necessary to accommodate shared management with Palestinian officials.
Among other things, this would require agreement with Egypt on the unimpeded movement of goods in bond to Egyptian ports. For problems associated with moving cargo through Egypt see: “Transit Trade and Maritime Transport Facilitation for the Rehabilitation and Development of the Palestinian Economy,” UNCTAD, 2003.
The World Bank estimates that it will require US$50 million to restore the airport to operating condition and to establish handling facilities for perishables. The Bank questions whether or not this investment is justified in the short term. The Bank suggests a helicopter operation might be more suitable for the near term. The World Bank, “Disengagement, the Palestinian Economy and the Settlements,” (June 23, 2004): www.worldbank.org/ps.
Ibid., 28-29.
Mr. Nasser Ju’eidi, Director of Rafah Chamber of Commerce, cited in: MOPIC in cooperation with the UNDP, “Report on Rafah District,” Palestinian Participatory Poverty Assessment Project (PPPA) (March 2002), 17: http://www.pppap.org/what/district/pdf/PPA-Rafah.pdf.
Al Mawasi is a narrow strip of coastal land located in the Southern Gaza Strip along the Mediterranean coast from the Egyptian border to Deir El Balah. It has two separate areas of administration; Al Mawasi Rafah located to the west of the city of Rafah and Al Mawasi Khan Younis located to the west of the city of Khan Younis. All but about 3 linear Km of coastline falls within Khan Younis. According to the Oslo accords, Al-Mawasi area was classified as a yellow area placing it under Israeli security control, but under Palestinian civil jurisdiction.
See Phase Three.
The World Bank, “Disengagement, the Palestinian Economy and the Settlements,” (June 23, 2004): www.worldbank.org/ps, 29.
Note: Conference participants favored the specific scheme identified as “Khan Younis.”
As discussed below, secure rail seems the best solution connect to Gaza and the West Bank. Other transportation modes, however, will be considered in the feasibility study.
Such “safe passage” was an important part of the Oslo Accords and was again “accepted” at both Camp David and Taba.
The World Bank, “Disengagement, the Palestinian Economy and the Settlements,” (June 23, 2004): www.worldbank.org/ps, 28.
It should be kept in mind that, according to the Sharon Government and many other prominent forces in Israeli politics, the economic development of Gaza and West Bank–because it will both stabilize the territories and also reduce the number of Palestinians seeking work in Israel--is directly in the long-term interest of Israel. A secure tunnel serves Israel’s interest in the economic development of Gaza and the West Bank.
Such projects might include desert reclamation in the Halutza sand region, an area which might be made available to the Palestinians as part of a comprehensive peace; this, as part of an overall effort to meet the demands of a “right of return” for Palestinian refugees. Similarly, shares in certain pieces of this macro project might be used to “compensate” Palestinian refugees.
For aerial photos of Israeli settlements in Gaza: Applied Research Institute Jerusalem: www.poica.org/casestudies/Gaza%2009-02-2004/index.htm.