Palestine: United States’ Peace to Prosperity Economic Plan

Thursday 18th July 2019

(4 years, 11 months ago)

Lords Chamber
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Question for Short Debate
Asked by
Lord Cope of Berkeley Portrait Lord Cope of Berkeley
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To ask Her Majesty’s Government what assessment they have made of the government of the United States’ Peace to Prosperity economic plan for Palestine, published on 26 June.

Lord Cope of Berkeley Portrait Lord Cope of Berkeley (Con)
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My Lords, I have been going to Israel/Palestine and following events there for 50 years, ever since I got married. My wife was the third generation of her family to be born in Jerusalem, her great-grandparents having gone there from America and Germany, for Christian reasons, in the 19th century. The family still have commercial and charitable links in east Jerusalem. We have friends of all religions and political loyalties throughout the region. Over that time, I have seen for myself the tremendous achievements of Israel. The building of infrastructure of all kinds—for example, Ben Gurion Airport, the roads, the towns and the excellent tram system in Jerusalem—strikes one every time. Of course, the Israelis have made great contributions to science, medicine and agriculture, and in many other ways.

This impressive progress in Israel is in contrast to the problems and repression in Palestine, originating in the period of British rule but exacerbated by the present policies of the occupying power. Over the last 50 years, there have been times of hope for peace in Palestine/Israel and times of despair. Oslo was a time of hope, as were the early days of the Obama Administration. The early days of the Trump Administration held out the prospect of a new approach leading to an “ultimate deal”. The word “deal” indicates the businessman’s approach—economics before politics. I have no difficulty with this approach in principle, but the reality is that, in this case, politics and economics are inextricably linked.

I am glad to have the opportunity to draw attention to this long-awaited document. It comes from the White House, rather than the State Department, which gives it added significance. It is a detailed analysis of the way in which Palestine might progress to prosperity and so to peace. I am sure we all agree that peace and prosperity go together, but which is the horse and which the carriage?

The document is advertised as an economic development document, but the chosen wording throughout is drenched with politics. It never refers to “Palestine”, only “the West Bank and Gaza”, thus avoiding admitting that there is such a place as Palestine. It also leaves out east Jerusalem, which the United Nations, the Palestinians, we and others agree is essentially part of occupied Palestinian territory. It never refers to the Palestinian Authority but “the Palestinian public sector”, even when discussing essentially governmental activities such as tax collection. It frequently mentions “Palestinian people” but never “Palestinian nation”. In other words, it systematically tries to pick off the individual people and not allow them any nationhood at all. It denies the two-state solution and looks entirely to one state—otherwise known as annexation.

I want to refer briefly to a few of the specific proposals for the economic development of Palestine which expose the way the American Government are looking at this situation in the document. Page 22 offers help to:

“Support … a new … university in the West Bank and Gaza”.

At present, the occupying power makes life as difficult as possible for the existing 14 recognised Palestine universities. Page 27 offers support to:

“Construct new roads throughout the West Bank and Gaza”.

There are of course some excellent new roads built there by the occupying power. However, they are not for the use of Palestinians, but solely the army and the settlers.

Pages 32 and 34 offer help with power and water supplies. At present, the settlements have ample power and water, but the neighbouring Palestinian villages often have supplies for only a few hours a week. In Gaza, it is of course much worse. Page 40 offers help with agriculture, including irrigation, but the occupying power takes the water for irrigation and has taken much of the best land for farming—for example, in the Jordan valley, which is as far away from Israel as you can get without going into Jordan. Page 41 talks of improving mortgage facilities to build more homes, but planning permission is given for building large blocks of settlements—whole new towns—and constantly refused to Palestinians, even for house extensions or schools in east Jerusalem or Area C. Page 67 is about improving healthcare, when the problems in Gaza include bombed hospitals and children wounded by high-velocity bullets.

Gaza needs access to the outside world, but this document does not refer to building an airport or seaport. The international community actually did just that some years ago; Israel promptly bombed them flat. Looking further north, it does not talk as it might have done, for example, of reopening Kalandia Airport from the Mandate and Jordanian days, between Ramallah and Jerusalem. These days, Kalandia is known only as the busiest and often most difficult checkpoint in the West Bank and for its large refugee camp. The airliners were replaced by the military.

The proposals in the document are not novel, for the most part, and nothing is said about where the money is to come from. This ignores the fact that the USA has just withdrawn its funding to UNRWA and Palestine. What is principally needed for the economic development of Palestine is for the occupying power to stop crushing local initiative and stop building on occupied land. The document analyses what is required for Palestinian development but is also, in its way, a terrible indictment of what the occupying power has used its effective best to prevent happening.

I say to the Americans who wrote this document that peace is possible. There is undoubtedly a deep longing for peace with equality among many on both sides. But peace will not come from ignoring the Palestinians’ right to self-determination, nor from brutal repression. The document deliberately ignores Israel’s security problems and policies; that is not what it is about. The fact is that the policy of the present Government of the occupying power is not based even on the Biblical “an eye for an eye” but on “a bullet for a stone”. Such policies are wrong and never work—and I condemn the rockets from Gaza as much as the airstrikes on Gaza.

Her Majesty’s Government know that there is no peace to be had in the so-called one-state solution. They are right to continue their support for a two-state solution, as the Prime Minister did the other day. That now requires the recognition of the second state of Palestine, just as the PLO recognised Israel many years ago. The Government are right to go on helping to build Palestine, but this plan is no help to that end.

Lord Anderson of Swansea Portrait Lord Anderson of Swansea (Lab)
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My Lords, like the noble Lord, Lord Cope, I have tried to follow the initiatives for peace between Israel and Palestine over the past 50 years. Sometimes, as he said, there appear to be signs of hope, as under Prime Ministers Rabin and Olmert, and in the early years of the Obama Administration. Some plans have begun by addressing the core issues—Jerusalem, borders and refugees—and others start with more minor confidence-building measures and hope to build incrementally on them. All have failed.

Now we are presented with what President Trump calls the “deal of the century”. It envisages a major capital investment in education, health and infrastructure for the Palestinians, but makes no mention of Jerusalem, the settlements, boundaries or Palestinian statehood. As the noble Lord, Lord Cope, said, politics and economics are inextricably linked. Are these proposals more likely to succeed?

I will look briefly at the context, the US promotion and the likely response. The context is depressing. For Israel, there is of course the existential question. The Netanyahu Government have acquiesced in the status quo and have drifted from a position of strength—save that in Jerusalem and the territories they are building more facts on the ground. However, they appear to seek no destination, even though the facts of democracy suggest that now is surely the time to seek a solution from a position of strength. The Palestinians are divided, bankrupt and rudderless. Their leadership is elderly and weak. They peddle illusions such as a vast return of refugees, which can only destroy the State of Israel.

Now we come to the proposal by the United States. Some 88% of Palestinians believe that the US is partisan, and, as all signals from the US have shown, it is. It can hardly be a trusted, honest broker. The US proposal is constructed by economists and management consultants, irrespective of the politics of the area. As is well known, the heart has it reasons, which reason cannot comprehend.

As a German politician said at the time of the Treaty of Versailles, the hand which signs this treaty will be signing its own death warrant. This is well known to the Palestinian leadership. The plan will surely be stillborn.

Lord Palmer of Childs Hill Portrait Lord Palmer of Childs Hill (LD)
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My Lords, I thank the noble Lords, Lord Cope and Lord Anderson, for their words.

Many people said in advance of the US initiative that we would be disappointed—and it has lived up to that disappointment. The Palestinians boycotted the conference in Manama, rejecting the plan out of hand. The Israeli government representatives were not invited to attend. In my view, no plan for peace between Israel and the Palestinians will have any chance of succeeding unless Israelis and Palestinians face each other across a negotiating table.

President Trump portrays himself and his family as masters of making a deal. For a deal, one needs a willing buyer and a willing vendor; as with all deals, there has to be a level of compromise on both sides. A state of Palestine has to be on the table. Security and recognition of Israel have to be on the table. Hamas needs to drop its aim of removing Israel from the map and stop firing rockets. As a first stage, Israel needs to cease expansion of settlements outside the land swap area.

But let us try to be positive. Bahrain’s Foreign Minister said the Palestinians had made a mistake by boycotting the conference. The Saudi Finance Minister would support anything that,

“brings prosperity to the region”.

The Finance Minister of the UAE said:

“We need to give this initiative a chance”.

The argument for accepting the money and the plan as a foundation for the economy, with an empowered Palestinian people with an effective Government, should be seen at the very least as a step on the way to greater progress.

There is, of course, legitimate doubt about how the Trump White House envisages final status arrangements. As previous speakers said, the UK should continue to stress the need for a two-state solution. What role can the UK play in advancing some of those proposals? We could of course remind people of the Jews from the Arab lands—about 850,000—who fled there. As an example in the short time available, there were 76,835 Jews in Baghdad in 1947 and there are none now. That is the other side of this disaster.

What do the Palestinians have to lose? That is the question. It does not, as a Palestinian spokesman said, kill the aspirations of the Palestinian people. They should have aspirations and we should support them. Is the proposal faulty and does it fail to address the underlying disputes? Of course; it is incredibly faulty. It is a property developer’s plan without any regard for the people—but it should be seen as a positive move in, at the very least, improving the lot of the people in Gaza, the West Bank, Egypt, Jordan and Lebanon.

Viscount Waverley Portrait Viscount Waverley (CB)
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My Lords, I reaffirm my declaration as set out in the register. Political horizon and Palestinian support for this economic development plan are both essentials for proper management and supervision of regional donor-funded projects. Both are lacking. Palestinians have given the Kushner plan a thumbs down. The Kerry initiative was considered to have held more credibility, offering a more solid economic approach and identifying the enablers, most of which remain unfulfilled.

The Kushner plan is heavy on infrastructure projects, capacity-building and ideas to entice investors, but light on who will pay, which Government will oversee development and where the land is. The projects listed are old initiatives and ones never executed because of the refusal to grant permission to allow the movement of both people and goods. It calls for a multilateral development bank to oversee distribution of funds for the projects. The architects have failed to recognise that only the Palestinian Government can lead the development of their national economy. No donors will make a significant outlay of funds in an uncertain political environment, particularly with the regular destroying of donor-funded projects.

It should also not be forgotten that the United States and European countries have designated Hamas as a terrorist organisation. The Anti-Terrorism Clarification Act prevents the PLO and the PA accepting economic aid from the US. This therefore excludes the US as a donor. Additionally, EU and Saudi donors expect a political framework with established borders, with the objective of a Palestinian state with a shared capital of Jerusalem.

A possible call by any new Israeli coalition Government for the annexation of Area C, including 62% of the West Bank, which is required for agricultural initiatives and any large-scale infrastructure projects, including for water, wastewater treatment, energy and transportation, would therefore be a further complication. The natural resources necessary for projects include water, quarries, gas, minerals and tourism sites under Israeli control. The plan does not envisage Israel relinquishing its control. Although a major road between Gaza and the West Bank is called for, sovereignty over the corridor is not.

The plan, for the reasons I set out, is dead in the water and falls foul of perceived contrivance through the back door. The pain and dilemma therefore continue.

Lord Bishop of Southwark Portrait The Lord Bishop of Southwark
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My Lords, I add my congratulations to those already offered to the noble Lord, Lord Cope of Berkeley, on this timely and important debate. As many of your Lordships may know, I generally visit the Holy Land twice a year. Each January, I accompany the Vatican’s Holy Land co-ordination group to the area as the sole Anglican bishop. I have experienced much Israeli and Palestinian hospitality down the years. I am only too well aware of the State of Israel’s just concerns for its security and its safeguarding of the holy places of Jerusalem, but I have witnessed Bethlehem walled in on three sides, Palestinian agricultural land divided and appropriated by military structures, and the acquisition of swathes of the West Bank and east Jerusalem for the settlement of Israel’s citizens and the exclusion of Palestine’s.

I acknowledge the important emphasis in the published document on increased investment, exports, tourism and better governance and indeed the interest of the current US Administration in these matters. However, I regret that I do not find in the current US proposals a means to end the occupation. I do not detect a dialogue between the US Government and their Israeli allies on this matter. Nor is any consent sought from the legitimate representatives of the Palestinians.

The Peace to Prosperity initiative is meant to convey a sense of progress and, if implemented, rapid transformation. But without a proper relational settlement, this is a chimera. Israel must be free, and Palestine must be free. It is the position of the Churches that a two-state solution must be brokered. I hope that Her Majesty’s Government will consider expeditiously past resolutions of this and the other place on recognition of the Palestinian state. While Palestine is under occupation and that is an implicit factor in international affairs, this plan and any like it will be destined to fall.

Baroness Morris of Bolton Portrait Baroness Morris of Bolton (Con)
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My Lords, I thank my good and noble friend Lord Cope of Berkeley for his powerful opening of this debate and for giving us the opportunity to discuss the Peace to Prosperity plan.

The vision of this economic plan, unveiled in Bahrain last month,

“to empower the Palestinian people to build a better future for themselves and their children”,

is an aspiration which has been widely held for many years, not least by the Palestinian people. I am privileged to have been able to play a small part in the economic well-being of Palestine as the Prime Minister’s trade envoy to the Palestinian territories. I declare my interests as the president of Medical Aid for Palestinians and president of the Palestine British Business Council.

That the Prime Minister of the United Kingdom, almost seven years ago, appointed a trade envoy to Palestine as one of eight trade envoys to be appointed around the world, shows the importance that the UK attaches to Palestine and her prosperity. On one level, I can understand the enthusiasm of the plan unveiled in Bahrain for boosting the Palestinian economy; we have all been there. Anyone who has spent any serious time in the West Bank, Gaza or east Jerusalem cannot fail to be impressed by the intelligence, ingenuity, resilience and decency of the Palestinian people, or want to find a way to unleash those qualities.

When I came back from my first trip as trade envoy, I was fizzing with ideas: IT, tourism, infrastructure, the agri-economy—none of them new or original ideas, all in the Kushner plan. But I soon came to realise that, however enthusiastic and ambitious you may be, you cannot avoid the occupation, which not only subjugates the people but frustrates the normal rules of economics. There are some amazing Palestinian companies and entrepreneurs, and their ability to thrive in this environment speaks volumes for what they could achieve in a free, sovereign Palestinian state. As my noble friend Lord Cope said in a speech earlier this week, the Prime Minister emphasised the UK position of a safe and secure Israel, living alongside a viable and sovereign Palestinian state, based on 1967 borders, with agreed land swaps, a realistic settlement for refugees and with Jerusalem as a shared capital of both states. That is the first, not last, step to peace and prosperity, and the only key to unleashing the phenomenal potential of the Palestinian people and their economy.

Lord Turnberg Portrait Lord Turnberg (Non-Afl)
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My Lords, the one thing that has come out so far from President Trump’s “deal of the century” is the offer of large amounts of money to the Palestinians; not all of it American money, of course; but then he is first and foremost a businessman. It is to build a prosperous and vibrant Palestinian society. Trump is not someone who has much grasp of the history of the Middle East. Certainly, money is needed, but he should know that bribery will not work while the basic problems around Jerusalem —refugees, settlements and security—remain unchanged.

The history of Palestine has shown repeatedly that simply offering money has never worked. In the 1920s and 1930s there were debates in this House in which much was made of the belief that, since the Palestinian Arabs were then so much better off than their cousins living in Egypt and Syria, they would automatically accept their country, as they saw it, being taken over by the influx of foreign invaders from Europe. The Zionists were certainly bringing increasing prosperity, with rising employment and better wages and living conditions, and Arabs from elsewhere were immigrating in increasing numbers, but never for one moment did the Arabs accept the idea that they were not being given the independence to govern themselves, as was happening in Syria, Egypt and Iraq, and that they were powerless to stop the influx of the Jews. Prosperity and money did not talk then, and it will not do so now.

When partition of the land was proposed in the Peel report of 1937 and repeated in the UN in 1947—two-state solutions, if you will—the Palestinians would not have much to do with the idea, and they have been somewhat resistant for most of the time since. We still have partition but not two states. I believe, as others have said, that a two-state solution is the only show in town. We in the UK should take advantage of our position of relative trust with both sides to press the case: to press the Israelis to move on the settlements and the other restrictions; and equally importantly, to persuade the Palestinians that Israel is there to stay. It is not about to disappear, and we should use our influence with Saudi Arabia, Egypt and the Gulf states to put pressure on the Palestinian leadership to give up their anti-Israel rhetoric and incitement and restart direct negotiations. These Arab states are anxious to do a deal with Israel and there are opportunities now that did not exist a few years ago. Will the Minister say what efforts our Government are making to work with our allies in the Middle East? We certainly cannot rely on Trump, in whom I fear the Palestinians have lost trust.

Lord Dykes Portrait Lord Dykes (CB)
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My Lords, it is a very great privilege to follow the noble Lord, Lord Turnberg, who is a great expert on the subject and some years ago wrote an outstanding book on the need for peace and for two states between these two countries. I warmly thank the noble Lord, Lord Cope, for his initiative in launching this debate today. He has a brilliant record of deep knowledge of the problems in this area and has fought for justice for Palestine for many years; I thank him for that.

I have been a friend of Israel for many years. It is a fabulous country, which used to be much more cheerful than it is now—I am sad to say that. We know that the development of extreme right-wing politics under the Netanyahu Government has made people more uneasy about the future, even though their triumphalism makes it look as though they are being successful. That is a huge problem and it is going to get worse, unless Netanyahu’s Government in Jerusalem, with their lack of wisdom, change their mind fundamentally on these points. This has been a theme that has come through in every speech in this debate: it is essential that they do that.

Unfortunately, the erratic, inexperienced and ignorant President of the United States—the worst President that that country has ever had the misfortune to have—does not know anything at all about this subject and just takes one side; and not even the side of Israel as a country, but that of the Netanyahu Government. That is a foolish stance to take and leads us nowhere at all down this vital road.

I have always admired Israel as a wonderful country, but I am convinced that if justice is given to the Palestinians, next door to it another wonderful country will be created. With full peace and justice between them and all these decisions resolved, they will shake hands and work together as two of the most dynamic countries in the Middle East to promote not only their own reciprocal prosperity, strength and political security but that of others in the area as well. It is so foolish of the narrow-minded Netanyahu Government to ignore these realities.

So many Israelis are frustrated beyond belief at the attitude of this Government. It is a terrible election system anyway, because there are no constituencies—only the national list system, which inhibits the representation of a lot of people who would like to be better represented. Because of that, and due to the lack of a threshold, we see odd, eccentric, minority parties joining coalitions all the time, now with an increasingly right-wing texture. That is causing a doom-laden future to come through more and more.

The reality is that the Israeli Government have to accept that they must change. If they do, Israel and Palestine will come together. Palestine cannot be the only UN member state in the world to be denied its sovereignty.

Baroness Northover Portrait Baroness Northover (LD)
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My Lords, I too thank the noble Lord for securing this debate; he introduced it with wisdom and a devastating critique of the document issued by the White House.

The region is a tinder-box, made more volatile by the USA pulling out of the Iran nuclear deal. This makes it even more important to find a resolution to the Israeli-Palestinian conflict. At the end of 2018, Trump announced that his “ultimate deal” for Israel and Palestine was about to enter the pre-launch phase. He has remained extremely secretive about the political contents of the deal. Astonishingly, the proposal seems to be to seek to work around, rather than engage, the Palestinians—not a recipe for sorting out any conflict. Economic development is severely constrained by the lack of a political solution to the control of land, resources and borders. Trump has further undermined that economy by pulling out support.

Daniel Kurtzer, US ambassador under George W Bush, tweeted:

“The authors of the plan clearly understand nothing”.

Dan Shapiro, who served under Barack Obama, said that,

“there are two big problems. First, the US had aid programs to support all these goals, but the Trump administration cancelled them. That kills our credibility in asking others for money. Second, you can’t get others to invest in this effort without knowing the political backdrop”.

Arab states have announced no pledges of funding. They reiterated support for a two-state solution based on the Arab peace initiative. Meanwhile, the future of a Palestinian state continues to be undermined by huge settlement expansion.

Can the UK therefore use whatever relationship it now has with the US to convey a message that a settlement to the Israeli-Palestinian conflict requires negotiation and, as my noble friend Lord Palmer said, the inclusion of the Palestinians as well as the Israelis in that process? Meanwhile, it is vital to reinstate support for human development, especially education and health.

Will the UK reiterate its commitment to a two-state solution, with Jerusalem as a shared capital for the two states, and its opposition to the expansion of settlements? Does it accept that the time has come for the UK to recognise the state of Palestine, as 137 of the 193 member states of the UN—71%—have now done? Does it think that the US can be a trusted mediator? I look forward to the noble Baroness’s reply.

Lord Collins of Highbury Portrait Lord Collins of Highbury (Lab)
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My Lords, I too thank the noble Lord, Lord Cope. He was absolutely right: this debate is about whether the cart has been put before the horse. When I recently met the PLO’s Secretary-General—the noble Baroness, Lady Morris, was there too—he stressed this point, making it clear that there can be no discussion about the economic situation without first discussing the political one.

As the noble Lord, Lord Cope, mentioned, and my noble friend Lord Turnberg has highlighted, Kushner’s plan completely failed to mention any of the key political factors that are barriers to Palestinian economic development, including the occupation of territories and lack of a Palestinian state; the security challenges to both Israel and the occupied territories; the settlements in the West Bank; US cuts to UNRWA and other aid programmes, as we have heard in the debate; and Hamas control of Gaza. These are all key factors that have to be addressed and discussed first.

The economic plan also fails to address the impact of the cuts that Trump has made to projects funded by USAID, which have had a devastating impact throughout the region in Palestinian areas, as well as in areas with high concentrations of Palestinian refugees. Even more galling was to see photographs of those exact projects in the published plan—that beggars belief.

In addition to the cuts to UNRWA, Trump has also cut other USAID programmes, including cross-border peace and reconciliation activities. I pay tribute to my noble friend Lord Turnberg, who has spent a great deal of time focusing on those inter-community activities which are building confidence on the ground between the two communities. They are essential ingredients to any sustainable peace. I would like to hear from the Minister about how we are doing more to support those initiatives on the ground, as well as protecting against some of the impacts of those US cuts.

As everyone has said, the best way of achieving peace in the Middle East is a two-state solution with a secure and viable state of Israel living alongside a secure and viable state of Palestine. I hope that the Minister will repeat that commitment and set out a way that we can deal with how it is to be delivered.

Baroness Goldie Portrait Baroness Goldie (Con)
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My Lords, I thank my noble friend Lord Cope of Berkeley for tabling this debate and all noble Lords for their thoughtful and informed contributions. I shall try to respond to all the points raised. If I may, I would like to touch on both the United States’ Peace to Prosperity economic plan as well as the current situation in the Occupied Palestinian Territories.

My noble friend asked for our assessment of the economic plan, launched by the US Administration at the Peace to Prosperity conference in Bahrain at the end of June. The UK Government welcome US efforts to support development of the Palestinian economy, which is fragmented, with slowing growth and rising unemployment among a young and growing labour force. I recognise that neither Israel nor the Palestinian Authority were represented at the workshop, but it was none the less a useful opportunity for the international community to consider how we can support the Palestinian economy. That is why we were represented at the conference by the Exchequer Secretary to the Treasury, my honourable friend Robert Jenrick MP. I reassure noble Lords that at the conference, we engaged closely with European and international partners.

As noble Lords are aware, the economic proposals outlined by the US were based on a proposed $50.67 billion investment plan into Palestinian and regional projects covering a 10-year period, and setting out to halve Palestinian unemployment, double Palestinian GDP, create 1.3 million Palestinian jobs and halve the Palestinian poverty rate. Of the costed projects and programmes across multiple sectors, some of which are already under development, over half are based in the Occupied Palestinian Territories, with the remainder split between Egypt, Jordan, and Lebanon.

The plan therefore proposes valuable programmes that seek to address a number of significant barriers to growth in the OPTs, and the proposals encourage international discussion on the development of the Palestinian economy, which is vital to reducing unemployment, promoting growth and improving Palestinian livelihoods. At this time, there are no political components to the plan and, for the time being, the occupation continues. The UK remains of the belief that a negotiated political settlement, leading to a viable and sovereign Palestinian state alongside a safe and secure Israel, is necessary. A two-state solution—a negotiated political solution—must be the umbrella to any economic proposals, and my noble friend Lord Cope identified that sensitive balance.

I also noted that the noble Lords, Lord Anderson of Swansea, Lord Palmer of Childs Hill and Lord Collins, the noble Viscount, Lord Waverley, the right reverend Prelate the Bishop of Southwark, my noble friend Lady Morris of Bolton and the noble Baroness, Lady Northover, all reflected their concerns about that missing element in the Peace to Prosperity plan.

My noble friend Lady Morris of Bolton, from her experience as a trade envoy to the Palestinian territories, spoke knowledgeably about the importance of trade and the economy. I thank her for her commitment and dedication in that role. I say to both my noble friend and the noble Lord, Lord Collins, that we continue to focus our economic development support in the Occupied Palestinian Territories, and we shall double the amount of UK aid spent on economic development in the OPTs to nearly £40 million between 2018 and 2023. This UK programme is focused on helping to address restrictions on movement and access, and improving water and energy supply, particularly in Gaza.

The current impasse on the transfer of clearance revenues, which Israel is withholding, threatens the collapse of the Palestinian Authority. We believe this is in no one’s interest and that it endangers stability and security. We are working with the parties to support the implementation of the Paris Protocol agreement on the transfer of revenues to the Palestinian Authority that are collected by Israel on its behalf. We will also support the transfer of customs functions if the parties can reach agreement on this issue.

On the distressing and perplexing issue of refugees, we remain one of the largest donors to the United Nations Relief and Works Agency for Palestine Refugees. UK funding enables the agency to provide protection, health and education services for nearly 5.5 million Palestinian refugees. The UK’s programme of work in the OPTs reflects our desire to see the creation of a sovereign, independent and viable Palestinian state, living in peace and security side by side with Israel.

My noble friend Lord Cope raised the issue of Palestinian nationhood, as did the right reverend Prelate the Bishop of Southwark. The UK’s position in this matter has been consistent over a very considerable period. We will recognise a Palestinian state at a time when it best serves the objective of peace. Sadly, we have not yet reached that point. In support of this ambition, we maintain pressure on the parties to end all actions that undermine the viability of the two-state solution. This includes Israeli settlement activity, demolition of Palestinian property in the West Bank, and evictions of Palestinians from their homes, particularly in east Jerusalem; equally, the Israelis have the right to live in peace and security, free from the threat of terror from Hamas and other militant groups. However, settlement development and related activity call into question Israel’s commitment to peace. We would strongly oppose any move to annex all or any part of the West Bank.

For the Palestinian economy to improve, Palestinians and Palestinian goods must be permitted to move more freely and on an equal regulatory footing. Palestinians need to be better able to exploit trade opportunities within the region and beyond. The recent memorandums of understanding between the Palestinian Authority and Jordan are a welcome sign of the Palestinians’ and Jordanians’ desire to increase trade between them. We call on Israel to allow this. We remain clear that the main constraints holding back Palestinian economic development are those imposed by the Israeli occupation. These constraints must be lifted to stimulate the Palestinian private sector. This can be done without compromising Israel’s security.

I emphasise, as my honourable friend the Exchequer Secretary to the Treasury made clear in Bahrain, that the UK remains committed to a negotiated two-state solution based on the 1967 borders, with Jerusalem as a shared capital. I reassure the noble Lord, Lord Turnberg, of our commitment to that objective. I also pay tribute to him for his book, Beyond the Balfour Declaration. I have been reading parts of it—I cannot claim to have read it all—and what I have read impresses me. It is one of the most analytical and balanced commentaries I have come across; I think that was the book the noble Lord, Lord Dykes, was referring to.

The noble Lord, Lord Dykes, also laid out a very welcome and positive vision of what might be possible for Israel and the Palestinian Authority—a vision that I think we would all share, nurture and want to encourage. We should thank the noble Lord for that optimism, and we should all be prepared to hold true to it and see what we can do to let it fructify and materialise.

I reassure the noble Baroness, Lady Northover, that the UK Government remain in regular contact with the US Administration on this issue and have been clear about our parameters for the minimum requirements for peace. The Foreign Secretary has discussed this directly with Jared Kushner on a number of occasions.

We welcome US efforts to improve the Palestinian economy. However, a negotiated political solution must be the umbrella to any economic proposals, if we are to ultimately unlock lasting and sustainable economic growth for Palestinians. We therefore continue to encourage the US Administration to bring forward detailed proposals for a viable Israeli-Palestinian peace agreement that addresses the legitimate concerns of both parties. We have been clear that we believe the only way to achieve this is through substantive peace talks leading to a two-state solution.

In the meantime, we believe that much can and should be done to improve the economic situation in the Occupied Palestinian Territories. As I have indicated, the United Kingdom is doing what it can to provide support, help and encouragement, and we call on Israel to engage and work with the Palestinian Authority to that end. The United Kingdom looks forward to continuing to support all efforts towards peace.

This has been a perhaps short but interesting and instructive debate in which your Lordships, from a variety of backgrounds, have offered views and opinions with authority. It is an important contribution to what I think is the concerted desire of us all to see a resolution to this difficult and perplexing problem in the Middle East. I think we all believe that a better future awaits Israel and the Palestinian Authority, if we can find that magical component to create peace. Then, the two communities can hopefully have a secure future, living side by side with each other.