Podcast: Alaa Tartir on building a sustainable Palestinian “resistance economy”

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The Palestinian Authority’s Salam Fayyad signs a multi-million dollar development agreement with the World Bank, 2009.

(Mustafa Abu Dayeh / APA images)

“What Palestinians need under occupation is a resistance economy. They need an economy that can support them in order to face the occupation, and eventually to end the occupation.” - Alaa Tartir, on this week’s podcast

This week on The Electronic Intifada podcast:

Rush transcript — Alaa Tartir of al-Shabaka Palestinian Policy Network, 19 October 2012

The Electronic Intifada: Let’s talk about the World Bank’s findings, and why you see it as a failure. And as you wrote in your report, how the World Bank has in fact helped to de-develop the Palestinian economy. Give us an overview of what’s been happening here.

Alaa Tartir: The World Bank’s report, which is called the growth report, tried to state the status of the Palestinian economy and provide a description of the obstacles it faces, and the major weaknesses and structural disproportions it suffers from; but majorly it provides a set of policy recommendations that are built on an economic model based on export-driven, private sector-led growth.

And actually a part of these policy recommendations, the major frank conclusion is that … the Palestinian economy is illusionary and unsustainable. And precisely, because of international aid, it was aid-driven and that made it unsustainable. That was the frank conclusion. However also at the same time, the report provided a number of policy recommendations that are quite irrelevant in many aspects, and mainly intentionally or unintentionally try to decontextualize the whole set of recommendations… A major problem with the World Bank over the decades, over the 20 years since Oslo, is that until today, the Bank and the major international donors, are still stuck in the era of Oslo, and they still deal with the occupied Palestinian territory in a post-conflict context.

And that in itself has a number of problems — the set of policy recommendations is actually not very suitable, because the status of the occupied Palestinian territories is [under] continuous occupation and it is an in-conflict situation. So the general framework there — there is a general problem. However the additional problem with the World Bank is that it minimizes the meaning of the occupation. And in that sense, it really does not go to the root causes of the problem and addressing the occupation so clearly and so explicitly is the problem there.

So it is a way that the World Bank and other international donor communities remain maneuvering around the problem and never address the root causes of the problem. They use very nice words with soft meanings to describe the occupation, like “restrictions.” And restrictions in any way does not equal occupation. If we dig more into the details of these set of recommendations, the most striking one was that the World Bank asked the Palestinians to imitate and emulate the “Asian Tigers” model, which are quite ridiculous suggestions, actually, because the major pillars and the major preconditions to achieve economic growth as Asian Tigers is really not there. And by all means, they are asking the Palestinian Authority to do so.

And all of us, as observers and Palestinian citizens, we know very well that the space of maneuvering for the Palestinian Authority in the policy arena is very limited. And then they are asking the Palestinian Authority to do something that they really can’t, and the Palestinian Authority find themselves — since 20 years — forced to do it. And they accepted it now, and now they are promoting it here and there. But this high level of expectation from an Authority that does not have any sovereignty or control over its own borders — they are talking about exports — it is really problematic.

The other difficult and strange recommendation is that the World Bank asked the Palestinians to provide one of the best business-friendly environments in the world, not only regionally or locally… so in a way, they’re asking an economy under occupation to perform excellently and give lots of incentives for investments, and be a good and friendly environment for businesses, while they are completely ignoring the facts on the ground. And that is the major point. They totally dismiss facts on the ground and the historical policies that the government of Israel has followed for many, many years.

EI: Alaa, talk about what you found are the sustainable building blocks to construct a sound Palestinian economy. What are the first steps, and what is the role of basic human rights in this equation?

AT: Well, I think the first steps will be a complete change and a complete shift in the development paradigm in the occupied Palestinian territories. It is time to change the whole mentality and to change the whole way development is perceived, and therefore to reform and rethink the international aid industry in Palestine. That is really the [biggest] step that we need to follow in order to go back to the basics in a way, and to go back to the first … things that what Palestinians need under occupation is a resistance economy. They need an economy that can support them in order to face the occupation and to eventually end the occupation. It’s time to change the way that the Palestinian Authority thinks about the development process, and along of course with the international community, to shift from understanding the development process in its very technical nature towards understanding the development process as freedom actually — and towards understanding it as a basic human right need to develop. And the rights for the Palestinians to develop. So it starts at the policy and perception level, that the policy makers need to change.

The neoliberal agenda is definitely not something new to the Palestinian life. And definitely when we say “neoliberalism in Palestine” it also has a Palestinian flavor to it. Since the establishment of the Palestinian Authority [it has] adopted a free-market economic system. And this implies a deep role for international organizations such as the World Bank and the IMF. And since then, we have the Washington consensus and the post-Washington consensus policy prescriptions.

These policies indeed are entrenched since 2007 with the arrival of Prime Minister Salam Fayyad, and Palestinians actually started to be referred to as one of the far examples of success stories after adopting a neoliberal agenda. However the facts on the ground is contradicting such perceptions by the international community, and they measure this success by the level of economic growth. However actually the major problem between the Palestinian elite and their neoliberal policies, and the facts on the ground and civil society voices is actually the legitimacy gap, first of all. There is a huge legitimacy gap that the Palestinian elite suffers from. And this indeed reflected of course in the way that people perceive the economic policies.

After 5 years of adopting a very strict and harsh neoliberal agenda, now we witness the results which are not coming as a surprise, since we all saw what such neoliberal agendas have done in other parts of the world. In that sense, Palestine will not be an exception. Over the last few weeks, we’ve seen people protesting in the streets against the Palestinian Authority’s neoliberal agenda and approaches.

This divide is widening. Particularly, if you were really attached to the ground and able to see the human suffering that Palestinians suffer from, these neoliberal economic policies created a massive gap between the people — and created a huge inequality gap between the rich and the poor… to the extent that is really widening. [It’s] the first time in Palestinian society that you can easily hear on the streets that there is no middle class. Either you become rich or poor.

This is actually a very expected and unsurprising result for such a neoliberal agenda. And because of that, we’re calling to revisit such an agenda for its negative consequences on the society and its social consciousness and cohesion and its multiple impacts on the Palestinian peoples’ ability to struggle against the occupation.

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