As navy patrol ships circled the Four Seasons Hotel in Bahrain Bay, Manama, a group of finance ministers and business elite from Europe, Israel, and the Arab world gathered to discuss purportedly imaginative interventions to transform the Israeli-Palestinian conflict. “A vision of what is possible with peace” was the theme reiterated by Jared Kushner, U.S. President Donald Trump’s son-in-law and his senior adviser who organized the “Peace to Prosperity” economic workshop held on June 25-26 in the Gulf Kingdom of Bahrain. As the first step in the long-awaited “deal of the century,” the workshop’s purported goal was to shore up Palestinian and Arab support for the political components of the plan which aims to resolve the Israeli-Palestinian conflict by promising billions in investment in infrastructure, education, and tourism in the Palestinian territories, Jordan, Egypt, and Lebanon.
The logic behind starting with the economic piece of the puzzle, Kushner asserted, is that advancing Palestinian well-being through investments is a “necessary precondition to resolving what was previously an unresolvable political situation.” If this formula sounds familiar, it’s because predicating progress on the political front with economic advancements is the backbone of the economic-peace rationale conceived by late Israeli President Shimon Peres. Peres envisioned “a new Middle East,” where integration into the wider Middle East would induce Israelis to make the necessary concessions for peace with the Palestinians. This inside-out approach attempts to bypass the thornier, final-status issues, such as borders, territory, and refugees, which the Trump team promises will be addressed in its political plan, contents of which have remained conspicuously secret. Despite reports that the plan has long been completed, its release is being postponed, yet again, due to upcoming Israeli elections in September.
Kushner—gifted the portfolio by his father-in-law—outlined the plan’s themes and goals in a diffident, yet arrogant, tone, as if this approach had never been tried before. His delivery garnered tepid applause and skeptical glances from the audience, which included a cross-section of the region’s finance ministers and mid- and low-level diplomats from ten countries. While unimpressive in its concrete results, the workshop reinforced preconceived notions on both the Israeli and Palestinian sides of the perceived benefits and pitfalls of the Trump administration’s approach. After the warm and gracious welcome in Bahrain, Israelis now feel they can reap the rewards of normalized relations with the Arab Gulf states, without making any compromises to the Palestinians. The Palestinian Authority (PA), meanwhile, understands that the U.S. is ready to move forward with its new formula for Middle East peace without them. Rather than provide reassurances that their concerns will be addressed, Kushner believes he can bypass the leadership, and gain acceptance from the Palestinian people directly, as they are “less invested in the politicians’ talking points than they are in seeing how a deal will give them and their future generations new opportunities, more and better paying jobs and prospects for a better life.”
This first glimpse of the much-touted deal portends little development on the main issues that have defined the last 25 years of Israeli-Palestinian negotiations. While utterly disconnected from reality on the ground, this “vision” may be an attempt to redesign what peace looks like. While the details remain merely conjecture, recent steps taken by the Trump administration appear to signal that Palestinians should no longer expect a U.S.-brokered peace deal to include a path towards statehood. Steps taken under the guise of pressuring the Palestinians to return to the negotiating table have instead taken the final-status issues, including agreements on refugees, borders and Jerusalem, off the table.
Maelstrom in Manama
Four days prior to convening the workshop, the White House released a forty-page document, under the same title, Peace to Prosperity, the Economic Plan: A New Vision for the Palestinian People, which pledges to raise $50 billion in investments over ten years to transform the West Bank, Gaza, and the lives of Palestinian refugees in Jordan and Lebanon. The two-day workshop covered various components of the plan, with panels discussing how to strengthen health care systems, advance strategic sectors for growth, and foster a culture of innovation. Conspicuously absent was any mention of who would provide or administer the funds, as well as official representatives from either the Israeli or Palestinian side.
The Palestinians never considered attending the workshop and have boycotted the Trump administration since the December 2017 decision to move the U.S. Embassy to Jerusalem from Tel Aviv and recognize the contested city as the capital of Israel. With no official Palestinian representatives attending, Egypt and Jordan rebuffed the American invitation and made their participation conditional on the assurance that no Israeli official would attend. At the last minute, Israel’s finance minister, Moshe Kahlon, was uninvited under the pretext that the workshop aimed to be a-political .With no official Israeli or Palestinian diplomats present, the workshop hosted small delegations of Israeli and Palestinian businessmen.
For Israelis, the workshop proved groundbreaking since Bahrain allowed six Israeli journalists to attend—an unprecedented move, as no official diplomatic ties exist between Israel and Bahrain. The lack of official channels notwithstanding, under-the-table security and commercial relations have long flourished between Israel and the Gulf states of Bahrain, Saudi Arabia, the United Arab Emirates, and Oman, primarily, as a means to counter Iran. The move from backchannel exchanges to conspicuous colloquy on the sidelines of the workshop represents a triumph for Israel. Arab leaders have typically refrained from publicizing their relationship with Israel under the pretext of “anti-normalization,” whereby Arab states boycott commercial and diplomatic relations with Israel until it withdraws from all the territory occupied in 1967 and until Palestinian national aspirations are achieved. The Arab states tend to opt for restraint out of fear of public backlash, as Arab public opinion for the Palestinian cause remains high. Following the workshop, Bahrain received pushback from Arabs across the region, as protesters in Baghdad raided the Bahraini embassy, and an outpouring of outrage fumed on social media against the apparent normalization.
Yet, the Bahrain workshop proved that the Gulf states were willing to put their own national interests ahead of the Palestinian cause. This normalization of relations should be taken with a grain of salt, as Arab delegates reiterated their positions in support of an independent Palestinian state under the two-state solution framework. The Gulf Arab states’ acquiescence to attend might be attributed to their fear of falling out of favor with the Trump administration, rather than an indication of a shift in their support for Palestinian sovereignty. Whether to remain in good graces with the U.S. or to advance their own security posturing against Iran, the Arab states’ compliance with this design is one factor amongst many that puts Palestinian national aspirations in jeopardy.
Official Palestinian absence signaled the deepening rift between the Palestinian Authority and the U.S. administration, and PA President Mahmoud Abbas likened the economics-first approach to a real-estate deal, where “national rights are purchased and sold.” Palestinian distrust of the American attitude is warranted when framed against the recent U.S. actions: ending economic assistance to the PA, closing the Palestinian Liberation Organization (PLO) mission in Washington, D.C., and recognizing Jerusalem as the capital of Israel.
The U.S. peace team has also refrained from mentioning the two-state solution or Palestinian sovereignty in its official statements. This break with decades of U.S. policy and international consensus leads Palestinians to assume the administration plans to trade advances in the economic sphere and standard of living with Palestinian self-determination and the right of return. Two days after the workshop, Special Envoy for International Negotiations Jason Greenblatt announced that Israeli settlements in the West Bank, which he referred to as “neighborhoods and cities” were not an obstacle to peace. He also blamed the Palestinians for boycotting the conference and for attempting to prevent others from attending. This is consistent with the position presented at the workshop: not once was Israel’s military occupation or blockade of the Gaza strip mentioned as an obstacle to Palestinian economic advancement, rather Palestinian intransigence was blamed as the main problem. Palestinians continue to toe the line, replying that any plan that doesn’t include the establishment of an independent Palestinian state on 1967 borders with Jerusalem as its capital is unacceptable.
An Uncertain Future for the Plan
While the U.S. convened the workshop in Bahrain, Israelis and Palestinians had more pressing issues to deal with than paying lip service to an event that failed to address the myriad challenges on the ground. The Palestinians are in the midst of an economic crisis. The PA has, for the third time, rejected Israel’s clearance revenues, the tax and customs duties it collects on behalf of the PA, due to a dispute over a portion of the funds Israel deducts each month under a new anti-terrorism law. If the PA is unable to meet its financial obligations, which appears imminent, this could spark a wave of protests leading to violent confrontations between Palestinians and Israeli forces. On the Israeli front, Prime Minister Benjamin Netanyahu, fearing indictment on corruption allegations and elections in September, is consumed with efforts to hold onto power.
Both the administration and the conference attendees stress that the economic components are not divorced from the political dimension, which ultimately is the key for peace. That Kushner’s conception of what constitutes peace departs from the traditional two-state solution formula appears certain. It also appears highly likely that the Palestinians will reject any plan that doesn’t include the promise of Palestinian sovereignty. It is unfortunate that the proposals outlined in Manama will never see the light of day, as economic independence and stability is a fundamental building block of Palestinian statehood. Yet, the administration has made it evidently clear that economic aid is contingent on Palestinian acquiescence to the political plan.
What remains to be seen is what comes after this charade flops: Will the Trump administration concede to the Israeli right-wing dream of annexing parts of the West Bank? Will the PA, left with no political cover to legitimize its existence, dissolve and give up its commitment to non-violent resistance? Skeptics remain unconvinced that the political plan will ever be released in its entirety and will be added to the long list of Trump’s haphazard and ill-conceived foreign policy proposals. From the charade displayed in Manama, tabling the “deal of the century” may prove to be the best choice for the Trump administration because the plan portends neither peace, nor prosperity.