Photo: Getty
Show Hide image

Europe must act to rein in Israel

The challenge for the European Union’s new foreign policy team of President Donald Tusk and High-Representative Federica Mogherini is to convert the foreign ministers’ rhetoric into reality, and to do so urgently. 

In the aftermath of the latest bout of killing and destruction in Gaza, European foreign ministers issued a statement recognizing the ceasefire had to be followed by political change to lift the “Gaza closure regime” and that return to the status quo ante “was not an option”. The challenge for the European Union’s new foreign policy team of President Donald Tusk and High-Representative Federica Mogherini is to convert the foreign ministers’ rhetoric into reality, and to do so urgently. 

This requires a step-change in Europe’s analysis and dealing with the underlying political problem, which is Israel’s deepening occupation, not just the horrendous humanitarian crisis left by the conflict. It means treating Gaza as an integral part of Palestine not - as Israel would like - as a separate issue. It means challenging Israel’s framing of the conflict as a response to “terror” and imposing real costs on Israel for its expanding expropriation of Palestinian land and resources. 

Israel has legitimate security interests but security cannot be used as an excuse for the blockade or the scale of “Operation Protective Edge”. Israel demonstrated the weakness of its “security” justification when it rejected the Dutch provision of a scanner to screen Gaza’s exports for smuggled arms or the offer of a European Border Force to police Gaza’s borders.

The recent conflict was inevitable. After the ceasefire in 2012 the Palestinian factions delivered a year of “quiet” in terms of rocket attacks but there was no easing of the blockade nor any slowing of Israel’s settlement program in the rest of the West Bank. Not unreasonably, Palestinians concluded Israel had no intention of ever conceding Palestinian control beyond the disconnected blocks of Area A. The latest Israeli announcement of the largest West Bank land seizure in 30 years confirms that view. Unless Europe responds with more than the usual condemnations and fruitless pleas to Israel for delay, the cycles of violence will continue, with their appalling toll of injury and death, and the Palestinian population will be further impoverished.

Europe and Israel

Europe is Israel’s biggest trading partner, but also a major provider of aid to Palestine - €2.5bn ($3.2bn) over the last few years. A recent evaluation by EuropeAid concluded the aid program far from developing the Palestinian economy had “reached its limits in the absence of a parallel political track that addresses the binding constraints”. Even before the conflict 80 per cent of the population of Gaza was dependent on aid. Now, with the scale of destruction of homes, hospitals, schools, water and power infrastructure and factories, the EU is faced with the cost of contributing to Gaza’s reconstruction again, and increasing humanitarian aid to meet people’s basic needs. The recent revelation that Israel’s blockade not only makes this aid necessary but forces much of the aid to be spent in the Israeli economy, will enrage European citizens even further. 

What then should the EU and its member states do? Europe needs to use its economic levers to hold Israel to account. Firstly it must suspend all arms sales to Israel today – not when the next conflict begins. Secondly the EU should propose a strict timetable for easing the blockade (coupled with an offer to meet Israel’s genuine security concerns) and for wider negotiations to end the entire occupation.

The EU should commit in principle to supporting Palestinian full membership of the UN and an International Criminal Court investigation of all sides in the Gaza Conflict. It could give a deadline for activating this commitment if no progress is made on easing the blockade or the occupation. It should also speed up the implementation of the FAC decision of 2012 to stop settlements being included in any of the benefits the EU currently applies to Israel.

Israel is currently the most favored participant of the “European-Mediterranean Neighbourhood Programme” (ENP). The ENP has a well-established practice of “more for more”, conditioning new benefits on delivery against ENP aims. For Israel it would be more meaningful to implement “less for less” and remove benefits in response to non-delivery.

Finally, ahead of the pledging conference in October in Cairo the EU must recover from Israel the cost to the EU and its member states of the aid provided for the reconstruction of Gaza, thus meeting its responsibilities as occupier for the occupied population.

Dr Phyllis Starkey is a trustee of Medical Aid for Palestinians (MAP) and a former British Parliamentarian

Dr Phyllis Starkey is a trustee of Medical Aid for Palestinians (MAP) and a former British Parliamentarian.

Show Hide image

MasterCard Worldwide

Could technology hold the key to eliminating financial exclusion?

Technology and electronic payments are a lever, providing new ways to bring people into the system and to reduce vulnerable citizens’ reliance on cash.

There is still a long way to go to improve the nation’s financial health.  A key aspect of this is to tackle financial exclusion, and to ensure that every adult is connected in the right way and affordably, to the regular, and therefore regulated financial system. Financial Inclusion is not a party political issue, it is a necessity which makes economic and social policy sense. Where people are financially included individuals, firms, and society as a whole benefit.   

The assumption that financial exclusion is a problem solely in developing economies alone could not be further from the truth. In Western Europe, the population of unbanked and underbanked totals 93 million people. The UK is also ranked ninth in the world in terms of banking inclusion, however two million adults still do not have a bank account. As the UK recovers from the economic crisis, living standards have fallen and inclusion in the financial system remains a major issue. This is despite the fact that the UK leads the world in financial services and technology. Sluggish wage growth, unemployment and macroeconomic uncertainties have placed great pressure on household budgets, exacerbating the fragility of personal finances for many of Britain’s most vulnerable citizens.

While there has been good progress made in the past to address the exclusion problem, the need to realise financial inclusion has never been greater. In March 2015 a report published by the Financial Inclusion Commission, a non-partisan, cross-party group of experts and parliamentarians, identified 20 key recommendations that policy makers could implement to create a financially healthy society. Among them was the recognition of the potential opportunities offered by developments in technology and digital innovation to connect all citizens to the banking system.

Technology and electronic payments are a lever, providing new ways to bring people into the system and to reduce vulnerable citizens’ reliance on cash. Evidence and experience has shown that where cash usage is higher, so is the level of corruption, poverty and exclusion, as well as lower levels of productivity and growth. The Bank of England recently published analysis of cash usage, finding that half of cash in circulation is held overseas or used in the shadow economy. Due to the untraceable nature of this tender, it is not known how much cash is lost to each market.

Promoting cashless economies, supported by technology, has a significant impact on the financial capability of individuals in managing private finances. New technologies enabling bank account holders to distribute their money into jam jars is an example of the role digital innovations are playing in addressing the exclusion issue.  There are already examples of where this is working. In the UK, the diverse London Borough of Brent recognised the opportunity electronic payments present and became UK’s first cashless local authority. Internationally, programmes like SASSA in South Africa and Adahaar in India, are overcoming the challenges of access and identification in disbursing welfare to remote communities, revolutionising the financial capability and access of the welfare recipients.

Yet, underlining all of this is a need for real leadership to drive the financial inclusion agenda. Politicians and industry both have important roles to play in joining-up and supporting the many organisations and individuals already doing good work in this area. Only through this leadership can the UK become a truly financially inclusive society.

Mark Barnett

President, UK and Ireland

MasterCard

Tackling financial exclusion is a global corporate objective for MasterCard, who provide support for the Financial Inclusion Commission.