Money in the Bank

Observations on Palestine

Bethlehem recently got a spring-clean. The frenzied rubbish collection and freshly painted road markings meant only one thing - important visitors were expected. This week, an estimated 1,000 foreign representatives from hundreds of companies gathered in the West Bank city for the Palestine investment conference, to discuss private-sector projects valued at around $2bn.

According to the conference organisers, the three-day event, co-ordinated by the Palestinian Authority, had a simple slogan: "You can do business in Palestine." Scheduled speakers included Tony Blair, in his role as the Quartet's special envoy, the Palestinian prime minister Salam Fayyad, and the United Arab Emirates minister of economy, Sheikha Lubna Khalid Sultan al-Qasimi.

The international donors' conference in Paris last December promised billions of dollars over a three-year period. Blair, who co-chaired in Paris and spoke at the subsequent London investment conference held at the beginning of May, has been pushing Palestinian economic improvement as an essential part of the peace process.

Thus the Bethlehem conference is part of a wider context, coming after visits to the region by Condoleezza Rice and President George Bush, and taking place in parallel with the announcement of apparent concessions by the Israeli military over West Bank travel restrictions. Blair's argument is that improving living conditions for Palestinians will draw them away from "violent extremism", a principal obstacle to peace.

But there is scepticism about this vision. Many ordinary Palestinians joke that they would love to host an investment conference every month; but only because it means the Palestinian Authority will clean the streets. But there are other reasons for doubt.

"The conference means nothing," said one man, who lives in the Dheisheh refugee camp. "Where can you build anything new in Bethlehem? We live in a prison. There's no room." If the conference does bring benefits, "it will be to the elite, the rich business people - not the average, struggling Palestinian", say others.

Bethlehem's governor Salah al-Ta'mari, a senior figure in Fatah, has cautiously welcomed the conference; other Palestinians hope investment will trickle down to their families and communities.

Meanwhile, interested outsiders, such as Jerry Marshall of Transformational Business Network, who already has experience in projects in the West Bank, believe business can make a difference: "Overseas efforts to stimulate the economy will drive political changes more than anything else," he says.

Nonetheless, there is an overwhelming feeling that investment under Israeli occupation can achieve only so much. Sam Bahour, a Palestinian-American entrepreneur in the Palestinian city of al-Bireh, said: "After the conference hall's lights are turned off and delegates are back home, it's an occupied economy . . . you can't take the occupation out of the economy with a conference or by throwing more millions of dollars at the private sector."

The week before the conference opened and a few minutes' drive from the InterContinental Jacir Palace hotel where it took place, Israeli settlers, accompanied by soldiers, invaded an area of Beit Sahour intending to establish a new settlement. It highlighted the kind of problem described by Jad Isaac, director general of the Applied Research Institute of Jerusalem.

"A conference will help in promoting the Palestinian economy," Isaac affirmed, "but this should come after we sign a peace deal with Israel, because I want to know my borders, in order to plan. For example, I would put some money in Dead Sea tourism - but that can only happen if Israel gives us access, with it being included in our Palestinian state."

While Israel's colonisation of the occupied territories continues, the risk for business is that investment can provide, at best, only superficial relief for besieged Palestinians. At worst, it will be pouring money into a bottomless pit. And at the same time, distract from the root causes of Palestinian economic woes.