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A Non-Marshall Plan for the Palestinian

(Jerusalem Post) Patrick Clawson - The Marshall Plan provided financing for dollar-starved European countries with good business environments and well-functioning governments. The situation of the Palestinian territories is exactly the opposite - a bad business environment and poorly functioning governance. The Marshall Plan distributed $60 billion (at today's prices), which worked out to $272 per European. By the end of last year, according to the World Bank, the Palestinians had received $4 billion since Oslo, which translates into $1,330 per Palestinian - more than four times as much as the Europeans got from the Marshall Plan. There are many countries much poorer than the Palestinian territories. Ethiopia gets about the same amount of aid as the Palestinians but has more than 20 times the population. The world has become concerned about unemployed Pakistani youth educated in radical madrassas, but aid to Pakistan is one-30th the Palestinian level. Aid from abroad has shot up since intensified violence began. The PA reported that in the first 18 months of the intifada, Arab countries provided $677m. in aid. According to the World Bank, donor funding was $482m. in 1999 before the violence began and ballooned to $929m. in 2001. The problem is not just with the aid agencies, which keep shoveling the money out the door irrespective of results. The bigger problem is that aid cannot provide what the Palestinians need, which is peace and better governance. The biggest single barrier to Palestinian growth is their violence against Israel, which forces Israel to impose closures and curfews. Those who want to relieve the suffering of the Palestinians should concentrate on stopping their offensive, which would allow Israel to lift the restrictions. The Palestinian economy could grow rapidly if we could put in place a non-Marshall Plan: more peace and better governance, without aid money that props up failing leaders and reduces the urgency for needed political actions like ending the violence. [The author is deputy director of the Washington Institute for Near East Policy and a former economist at the World Bank and International Monetary Fund.]
2002-08-09 00:00:00
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