A joint trilateral confederation between Israel, Jordan and
Palestine would extend over an area of more than 120,000 square
kilometers, on both sides of the River Jordan. Jordan will extend
over an area of more than 90,000 square kilometers, Israel over
22,000 and Palestine over more than 5,000 sq. km. in the West Bank
and the Gaza Strip.
The total population living in the area of the confederation would
number over 12 million, including 2.5 million Palestinian citizens
of Palestine, about 4 million citizens of Jordan, and about 6
million Israeli citizens. It can be expected that within five to
eight years after the establishment of the confederation, the
population would rise to over 15 million.
Six Million Palestinian Residents - A Key Factor
The outstanding demographic factor in the proposed confederation is
the existence of large communities of Palestinians, not only in
Palestine, but also in Israel and in Jordan. The total number of
residents in the states of the confederation who are considered,
and see themselves, as belonging to the Palestinian people is as
follows: about 5.5 million - 1 in Israel, about 2.5 million in
Palestine and about 2 million in Jordan. It should be added that
about half a million of Palestinians also live in Syria and
Lebanon. The number of Jews is about 5 million.
From a political viewpoint, each of the three states of the
confederation will be independent in all respects, each having its
own (or shared) capital city and its own national administration,
including government, parliament and judicial structure.
Confederation: Political Separation and Economic Unity
As against the present separation at the political level, in the
economic field the confederation constitutes a united geographical
area and a common market. A prominent characteristic expressing
this economic unity will be found in the existence of two open
borders between the three states of the confederation for the free
movement of people, including workers, as well as transport,
merchandise, currency, and various products and services.
An important institutional expression unique to the confederation
is to be found in the existence of trilateral confederation
development, and economic and social authorities. These are to be
found in a series of branches of national activity, including the
possibility of initiating development projects and of joint
institutions. We are referring to confederative authorities for
land traffic, tourism, medicine, education, culture, aviation and
space, fighting drugs and crime, water, energy, agriculture and
food, sports, army and security, finance, communications,
computers, etc.
A Trilateral Confederation - The Correct Way to a
Political-Economic Solution to the Palestinian Problem
On the one hand, a trilateral confederation assures the
independence of the State of Palestine which will be established in
the West Bank and the Gaza Strip. On the other hand, it holds out
great prospects of settling the Palestinian refugees in Palestine
and Jordan and of creating employment and speedy and impressive
economic growth, which will consolidate and strengthen these
states.
The Challenge of Confederation: Jordan and Palestine Can Enter
the League of Developed Nations
It should be stressed that the challenge of confederation is not
limited to a solution of the Palestinian problem. To this it is
important to add another challenge, that of striving to add Jordan
and Palestine to the league of developed nations. This means
economic integration and the development of progressive business
connections with the leading economic blocs in the world, e.g.,
North America, Western Europe and Japan.
This crucial goal is Middle Eastern and not only Jordanian and
Palestinian. In order for these countries to compete successfully
through implementing an ambitious strategic, economic goal of this
sort, they are in need of the most rapid growth levels and a
developed economic structure. This is also an Israeli state
interest.
The outstanding characteristics of a developed national economy in
the world today are as follows: entering global markets through
special trade agreements; growth through increasing numbers of
small and medium business enterprises in the leading branches of
the world economy, above all, high-tech and biotech; and initiating
large development projects, either independent or in cooperation
with neighboring countries.
The growth of Jordan and Palestine as progressive national
economies is the way to assure both their political independence,
the rehabilitation of millions of Palestinian refugees living
there, and also the settlement of those who will want to return
from refugee camps in Syria and Lebanon.
The Challenge: Raising the Per-Capita Jordanian and Palestinian
Average Income to the Present Israeli Level over a Period of Twenty
Years
Before examining how to work toward these targets, it must be
pointed out that we are speaking of most pretentious and ambitious
national economic goals, which demand creative and innovative
political and economic solutions. Nowadays, the average per-capita
yearly income in Jordan and Palestine is about $2,000, as against
an average of about $16,000 in Israel.
In order for Jordan and Palestine to approach this income level,
their total product must reach about 100 million dollars. This
means an increase of over 90 billion dollars within 20 years.
In more detail, the challenge to Jordan according to this approach
is to aspire to an annual product reaching about 60 billion
dollars, and for Palestine about 30 billion dollars.
The Keys to Growth in Jordan and Palestine: Aid Grants,
Encouraging Small Business Enterprises, and Special Trade
Agreements
In practice, such broad and dramatic growth depends upon a series
of economic steps, particularly broad in their scope:
The reception of grant aids at an annual rate of 2 billion dollars
from the U.S.A. and the European Common Market. These will be
directed to developing the educational infrastructure, roads,
housing, communications, computerization and finance in Jordan and
Palestine.
Special trade agreements with the U.S.A. and Western Europe, and
with other economic blocs, with the aim of assuring the free export
of produce and services from the states of the confederation to
world markets.
Encouraging the annual growth of thousands of new business
enterprises in Jordanian and Palestinian towns and villages, in all
branches of economic activity. Each of these will, on average,
circulate between $100,000 and $250,000.
These business enterprises will, for the most part, be small and
they will grow through local initiatives in Jordanian and
Palestinian towns and villages. A minority of them will be
established as extensions or large subsidiaries by tens of
multinational companies in different parts of the world, which will
reveal the great business potential inherent in the confederation
states.
Confederation - The Incentive for Jordan and Palestine to Join
Global Markets
There is little doubt that a confederal peace agreement between
Israel, Jordan and Palestine will pave the way to yearly American
aid to the extent of billions of dollars to Jordan and Palestine,
as well as to Israel.
Parallel to this, both the U.S.A. and the European Union will give
their consent to applying the special trade agreements that they
have with Israel, to Jordan and Palestine as well. This will
prepare the way for the opening of the prosperous markets of
Western Europe and North America to Palestinian and Jordanian
export, as they are open to Israeli exports. This is the way to
promote the growth of thousands of small enterprises and businesses
every year, and to draw in some tens of multinational companies to
work with them.
The establishment of the confederation and the special world
political status of the confederation as a whole and of its
component states, promise it a unique economic status not enjoyed
today by any state in the world: special trade agreements with
three world economic blocs - the markets in North America, in
Western Europe and in the Middle East. The continuation of peace
agreements will undoubtedly come in the form of special trade
agreements for the whole Middle East.
Confederal Development Enterprises
Confederation also means initiating and managing large joint
enterprises, which will provide high-income employment to hundreds
and thousands of workers with various degrees of skill from both
sides of the Jordan. They will bring increasing growth in
Palestinian and Jordanian buying power which, again, will
contribute to speedy growth in all regions of the confederation. We
are referring to a series of non-national development enterprises
whose joint establishment by the three confederation states will
assure their economic profitability and their financing through the
mobilization of the necessary international investment
capital.
The first such project will be large desalination installations,
which will assure regular water supplies for all the residents of
the confederation, and will facilitate the settling and flowering
of large desert areas in each of the confederation states. This
would involve a Dead Sea-Red Sea canal.
A second development project will be the construction of a joint
traffic system of roads and railways to facilitate the free and
speedy movement of vehicles and trains between all the cities and
regions of the confederation.
A third project will deal with large-scale tourist enterprises,
which will attract over 10 million tourists every year to the
confederation states.
A fourth project will be joint recycling installations.
A fifth project will be solar and hydroelectric installations for
the production of electricity in the Arava/Wadi 'Araba area and the
Dead sea area.
Potential for the Growth of a Middle Eastern Economic
Order
A special development enterprise proposed for the confederation is
the development of the Jordan Rift on both sides of the River
Jordan as a business and tourist area. It would incorporate tens of
thousands of projects in various fields of economic activity, with
the status of an area of free trade and production, without taxes
and customs. Thus the Jordan Rift would be changed from a
confrontation area into one of joint growth and development.
Over the years, with the establishment of peace between Israel and
the Arab states, there are good chances that this economic and
transit strip would be extended. It would then grow into an area
rich in development projects and business stretching from Saudi
Arabia to the south of the Red Sea and up to the Syrian border and
Turkey in the north.
Such a corridor would facilitate the growth of tens of thousands of
businesses and small enterprises in the many urban and rural
settlements on both sides of it, linking the emerging markets of
all the neighboring countries on both sides of the Syrian-African
Rift. This will have far-reaching implications for the economies of
Jordan and Palestine, which are located in the heart of the
Rift.
Lowering Unemployment and Creating Employment Possibilities in
Jordan and Palestine
Jordan and Palestine suffer from a chronically high unemployment
rate. About 30 percent of the work force in these countries is
unemployed. In numerical terms, this means the unemployment of over
100,000 workers in Palestine, and over 200,000 in Jordan.
Because of the special demographic structure in which millions of
Palestinians are living in Jordan, Palestine and Israel, one can
reasonably assume that the great majority of these unemployed are
Palestinian breadwinners and workers with skills of various degrees
and of all ages.
It can be added that hundreds of thousands of Palestinian and
Jordanian workers are compelled to move and seek work outside their
state, be it in Israel, in the Gulf states or elsewhere. With
borders open to the free movement of workers and vehicles, it will
be easier for these hundreds of thousands of Palestinians and
Jordanians to work in Israel without the restrictions and
constraints which apply today.
Moreover, in the confederation framework we will be witness to the
establishment of large industrial parks along the
Israeli-Palestinian border to the south and east, and to the
concentration there of industrial enterprises by multinational
companies that are world leaders in their branches. There will also
be Israeli enterprises which will transfer their production centers
from central Israel and the coastal area, and Palestinian
enterprises which will also move from the densely populated
Palestinian cities to these new and high-quality industrial areas.
This sort of strip of industrial parks on both sides of the
Israeli-Palestinian border can also make a real contribution to
promising full employment and a decent income to all in need of
these.
An Economic Commission to Promote the Development of the
Confederation
This broad and varied development - in the fields of economy,
erecting physical and human infrastructure, promoting trade,
foreign investment, etc., in order to meet Palestinian needs for
water, energy, transport, food, quality of life and decreasing
unemployment in all the confederation states - will not come of its
own accord.
Initiating each of these comprehensive economic steps behooves not
only economic unity, but also economic coordination and partnership
through a joint economic commission which will activate a series of
joint development authorities in each of these fields of
work.
In each of the development authorities of the confederation, the
outstanding experts in their fields from Israel, Jordan and
Palestine will be active members. Together they will crystallize
and promote a series of joint projects. Outstanding people from the
field of economics and business will also lead the economic
commission. In this way, the commission will grow into a joint
development institution for the three states of the confederation,
activating and bringing together hundreds of experts from the top
echelons of each state. This will contribute to generating hi-tech,
well-paid employment, benefiting Palestinians and Jordanians.
From a Trilateral Confederation to a Middle Eastern Common
Market
The establishment of the trilateral confederation on both sides of
the Jordan means the growth of an economic market of over 15
million consumers. There are some prospects that, in the course of
years, the confederation will also act as a stimulus for the
formation of a Middle Eastern common market which, at the end of
the process, could include over 300 million consumers.
The leading multinational companies in the world and the large
economic blocs would do well to understand this, and would quickly
appreciate the mighty business potential inherent in the
confederation and its special economic status in the Middle East.
This would be an additional reason for the confederation states to
become a lodestone for large capital investments in development
projects in all regions of the confederation. It would encourage a
high degree of openness by the heads of the leading economic blocs
in the world to the integration of the confederation states in
world economic life and markets.