Middle East

Documents & Texts from America.gov

21 May 2008
U.S. Vigorously Backs Palestine Investment Conference

By Phillp Kurata
Washington File Staff Writer

Washington -- The U.S. government pledged loan guarantees and other assistance worth millions of dollars to the West Bank Palestinian economy as part of the Palestine Investment Conference May 21-23 in the West Bank city of Bethlehem. Most of the money is in the form of loan guarantees to stimulate housing construction, information technology and other forms of private enterprise.

The U.S. Overseas Private Investment Corporation (OPIC) made available $500 million in loan guarantees to help Palestinians buy much-needed, affordable housing. The loan program is designed for home purchases of up to $75,000.

Ziad Asali, founder of the American Task Force on Palestine, said that there is an "incredible shortage" of housing in the Palestinian Territories, where "not a single village or town has been established since 1967." Asali co-chairs the U.S.-Palestinian Public Private Partnership, which is headed by Walter Isaacson, president of the Aspen Institute and a renowned author and journalist.

Asali said that with 30,000 housing units planned for construction, thousands of jobs will be created instantly, offering the people of the West Bank welcome relief from high unemployment.

Isaacson said the partnership initiative, designed to promote rapid job creation in the West Bank, also contains a venture capital fund, jointly managed by Israel and the Palestinian Authority, which will invest in new companies engaged in the information technology sector.

In addition, the Middle East Investment Initiative, a loan-guarantee program backed partly by OPIC and created in conjunction with the Aspen Institute, will make available $228 million in loan guarantees for local Palestinian banks to support small- and medium-sized businesses, Isaacson said.

"Already 18 projects are under way, from construction to the dairy sector," Isaacson said.

The Aspen Institute chief added that a "call center" will be opened in East Jerusalem for the purpose of providing Arab-speaking services to U.S. corporations doing business in the West Bank. In addition, the U.S. Agency for International Development is building five youth centers in the West Bank with the help of information technology giants Cisco and Intel to provide technical training and job skills to Palestinian youths, Isaacson said.

In another bid to encourage business in the West Bank, OPIC chief Robert Mosbacher said an insurance program to cover the risk of trade disruption will be set forth during the three-day conference. On a per incident basis, this will cover up to $75,000 in potential losses.

Israeli military security checkpoints and roadblocks throughout the West Bank hamper the movement of people and goods and obstruct business expansion, Mosbacher said. While the U.S. government supports Israel's security arrangements, he said, the trade-disruption insurance is an attempt to "wire around that as much as possible."

Larry Walther, the chief of the U.S. Trade and Development Agency, said he will sign at the conference a $480 million grant to promote the expansion of broadband Internet use in the West Bank. He said the West Bank will have about 45,000 additional Internet broadband users by the fourth year of operation of the Internet expansion program. This will create "a window to the world" for the people of the West Bank and enhance their business and educational opportunities, he said.

The Bush administration vigorously backs the Palestine Investment Conference, which, in the words of U.S. delegation leader and Deputy Treasury Secretary Robert Kimmitt, "is very important to improve the economic prospects for the Palestinian people to give the political process a chance to unfold."

Generating a vibrant private sector is "very much the lifeblood of any successful self-sustaining economy," Kimmitt said.

As for Gaza, Kimmitt said one session of the conference will deal with its economy. He said the United States will continue to contribute humanitarian assistance to the people of Gaza through the U.N. Relief and Works Agency while refraining from direct engagement with the Hamas government of Gaza, which the U.S. government considers to be a state sponsor of terrorism.

back to top ^