August 3, 2009 11:08 pm

The cost of Arab peace concessions

Once Barack Obama made up his mind to push for a resolution of the conflict between Israelis and Palestinians, it became inevitable there would be an epic test of wills between the US president and Israel’s prime minister, the irredentist Benjamin Netanyahu.

So it has proved, with Mr Netanyahu responding provocatively to US demands for a total freeze on Israel’s colonisation of occupied Palestinian land by expanding the number of settlers – on Sunday, for instance, evicting Palestinian families in Arab east Jerusalem to make way for Jewish families.

But, as everyone watches to see who blinks first, the Obama administration is seeing its strategy attacked from another flank.

Despite intense US diplomacy, Saudi Arabia, Washington’s closest Arab ally, has brushed aside efforts to extract Arab concessions – such as the opening of Israeli trade delegations in Arab countries – in exchange for a settlements freeze. On the face of it, it would seem reasonable for Arabs to gradually “normalise” relations with Israel, to help pave the way towards peace with the Palestinians. But their experience of the peace process has ensured that is not how most Arabs see it.

Prince Saud al-Faisal, the veteran Saudi foreign minister, is echoing widespread sentiments when he called for a “comprehensive approach” to peace that “defines the final outcome at the outset and launches into negotiations over final status issues: borders, Jerusalem, water, refugees and security”.

This is not just because Saudi Arabia is behind a comprehensive Arab-Israeli peace plan, spurned by Israel since it was endorsed by the Arab League in 2002. It is not just because gradualist processes such as Oslo failed because there was no agreement on the final destination, enabling the extremists on each side to exercise a veto. Nor is it just because many Arab leaders cynically use the situation of “no war, no peace” as an alibi to monopolise power and resources.

In 1992-96, at the height of the peace process, Israel reaped a peace dividend without concluding a peace. Diplomatic recognition of Israel doubled, from 85 to 161 countries, exports doubled and foreign investment increased sixfold. Per capita income in the occupied territories fell in the same period by more than a third, while the number of settlers expanded by half. A broad-looking avenue led quickly to a road-block. The Arabs have not forgotten, and Mr Obama will have to get more than a settlement freeze out of Israel to lure them down that road again.

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