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Analysis: What future for the Oslo Model?

Nov. 5, 2013 2:56 P.M. (Updated: Nov. 18, 2013 12:31 P.M.)
By: Al-Shabaka
The second installment of a two-part policy brief from Al-Shabaka, the Palestinian Policy Network. The first part can be found here.

Al-Shabaka is an independent non-profit organization whose mission is to educate and foster public debate on Palestinian human rights and self-determination within the framework of international law.

The policy brief is co-authored by Jeremy Wildeman and Alaa Tartir.


Since the signing of the 1993 Oslo Declaration of Principles, the donor community has invested more than $23 billion into "peace and development" in the Occupied Palestinian Territory (OPT), making it one of the highest per capita recipients of non-military aid in the world. However, aid has not brought peace, development, or security for the Palestinian people, let alone justice. Al-Shabaka Guest Author Jeremy Wildeman and Program Director Alaa Tartir examine the origins of the present aid-for-peace model as well as its effects on socio-economic conditions and pull together the many critiques of the Oslo economic model.

The authors argue that donors are reinforcing failed past patterns associated with the so-called peace dividends model while making only cosmetic changes to their engagement. Indeed, donors do not appear ready to change an approach dominated by policy “instrumentalists” who ignore and reject outcomes that do not match their pre-determined values instead of upholding international law on Palestinian rights and international development principles that strive to "do no harm." They underscore the alarming possibility that the Oslo aid model may serve too many interests to be dismantled and conclude with an assessment of what will be needed for change.

What Future for the Oslo Model?

Even though the Oslo model is a failure as far as Palestinian national aspirations and universal rights are concerned, it serves Israel’s interests. Israel’s influence in the US, when combined with the instrumentalist view that the problem with aid lies not in the model but in its application, means that Oslo may be around for many years.

Our conclusion is reinforced by interviews with informed observers of donor policies in the OPT. For example, a Palestinian West Bank-based critic of Oslo noted that even though some new donor programs had been introduced "these new programs are directly linked with the peace and normalization, in particular those of the Europeans." Another observer affirmed there is a push for joint projects, which "are aimed at breaking the resistance of Palestinians ... [and] for the subjugation of the Palestinians to the Israelis."

As for the donors, one major donor noted that there was no "specific change" in OPT programs – other than "re-emphasizing the regional importance of resolving the Israeli-Palestinian conflict, and the relevance of [our] approach to Palestinian state-building." Another major donor even went further to say that the Palestinian model was something that could be exported to the Arab world, given that their programs were "well advanced" in the OPT.

Yet even though the donor approach has not fundamentally changed, Palestinian attitudes toward aid have soured and increasingly echo the critical perspective of aid. There is growing anger toward international aid agencies that has moved beyond elite circles to the Palestinian street, and there have been many protests. These have included protests against the Paris Protocol, including by PA-related figures, although they are mostly confined to newspapers and media outlets. There have also been protests against USAID, which was the focus of anger during President Barack Obama’s recent visit, as well as against the European Union Coordinating Office for Palestinian Police Support and the Japan International Cooperation Agency (JICA).

Unfortunately, for those critics who aspire for a change in – if not a complete overhaul of –the aid model, the protests remain on the side-lines of the debate with little influence over policy. A perceptive donor pointed out that Palestinian protests were limited to issues that did not really challenge those in control and were not aimed at a strategic readjustment internally or toward Israel. For example, they said that the large protests focusing on economic conditions and on hunger-striking prisoners in fact "illustrate the timidity and limited horizons of Palestinian politics." Once protests exceed the boundaries set by the bifurcated leadership in the West Bank and Gaza they get reined back in.

In short, with little in the way of serious protest, there is nothing to compel donors, the PA or Israel to change their approach. Indeed, the most notable shift may be the role of Arab donors that have stepped in to support the existing model and possibly make it worse by increasing its structural deficiencies, such as recent Qatari investment into Gaza.

US Secretary of State John Kerry's latest economic peace initiative appears to be in line with the long-standing American policy of funding a "peace dividend" to help keep the Palestinians quiet and provide additional incentives for Palestinian negotiators to offer further compromises. The $4 billion plan intends to increase GDP by 50% over the next three years, which will further pacify the conflict. Alongside this Kerry plan is the "breaking the impasse" initiative that has brought together some 300 Palestinian and Israeli businessmen to kick-start a new wave of economic normalization.

In Search of a New Aid Paradigm

Some of those we interviewed made suggestions for change that challenge the Israeli occupation and the violation of Palestinian rights. These include strengthening the PA so that it can lead the development process, rather than just letting donors set the agenda; ensuring that aid does not create dependency or subsidize the occupation; redirecting aid from relief to development; increasing the amount of aid spent locally and decreasing the amount reverting to donors; and ensuring that aid does not reduce Israel’s obligations as an occupying power.

However, many critics of aid want to go further and to challenge the overall framework and comprehensively overhaul the existing paradigm. According to these voices, the keys to effective aid include:

1. Aid must support Palestinian self-determination and help the Palestinians resist the colonial project. It must not subsidize Israel’s occupation.

2. A unified Palestinian political, economic and developmental program is essential.

3. Aid should enable Palestinians to challenge Israel's control over resources and borders, which could for example include tapping gas reserves located off the Gaza Strip that Israel has so far blocked.

4. There is a need to end reliance on the U.S. by connecting with other regional and international powers, and with global civil society.

5. Political sovereignty is a must for effective aid; better aid allocation or more resources within a dependency relationship will change nothing.

6. Donors need to align themselves with the demands of Palestinian national movements such as the Boycott, Divestment, and Sanctions movement (BDS).

According to these critical voices, then, the development paradigm must urgently be shifted from one that considers development as a technocratic, apolitical and "neutral" approach into a model that recognizes structures of power, relations of colonial dominance and re-articulates processes of development as linked to the struggle for rights, resistance and emancipation. In essence, as one aid critic put it: "What we need is to get rid of Oslo and everything attached to it."

The time to work for change is now, especially since many donor projects will need to be renewed and refunded in 2013-14. Palestinians need to be organized to set the agenda. Otherwise, the aid industry’s approach will remain the same, with a rule of thumb that: "The US decides, the World Bank leads, the EU pays, the UN feeds."

Originally published on Al-Shabaka's website on Sept. 19, 2013.
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