USAID in Palestine – a form of neoliberalism?

28 Mar

According to Nour Odeh who wrote for Al Jazeera, USAID is planning to inject $153 million dollars into West Bank infrastructure projects this year. This is a significant increase from 2009’s $65 million dollars. Furthermore, since 1993, the US agency has pumped in $2.9 billion dollars into the Occupied Territories. These aid has gone into various sectors including youth and education; democracy and governance and trade and economic development.

Yet, Palestinians are keenly aware that such aid does not translate into actual political support. Says one driver who told the Al Jazeera correspondent, “They want to distract us with roads until our country is gone”.

Furthermore, as another Palestinian activist, Lunat concurred, the aid that has been handed out actually constitutes a guise to create a neoliberal economy that promotes consumerism.

This is apparent when Salam Fayyad, the appointed Palestinian Authority (PA) prime minister in Ramallah and a former International Monetary Fund official was praised by the West and the Israeli President for sticking to the peace process.

It is evident that the aid money poured into West Bank , but not Gaza, serves as a tool to alienate the democratically elected Hamas,

‘… The Netanyahu-Fayyad plan has been a magnet for foreign capital. The US Congress approved last July a deposit of $200 million into the PA treasury, under Fayyad’s direct control. In September donor countries pledged on the sidelines of the General Assembly $400 million to the PA by the end of 2009. Last month, the European Union transferred 21 million Euros to “help the Palestinian Authority pay the January salaries and pensions of 80,551 Palestinian public service providers and pensioners.”

This “West Bank First” policy of economic development replaced Bush’s failed policy of democracy promotion. In 2006, Palestinians in the West Bank and Gaza Strip elected Hamas but Israel and its western allies boycotted the movement because it did not conform to the demands of the Quartet, much of them at odds with international law’.

The more sinister aspects of such funding was the clampdown on Palestinian resistance against the Occupation,

‘… The American-trained security forces have kept a tight grip over West Bank towns squashing dissent and keeping “order.” When the Israeli army invades during the night, Palestinian security forces swiftly retreat. Intelligence sharing has enabled joint campaigns of arrest against members of the resistance.

The Guardian newspaper reported that Palestinians security forces have been working closely with the CIA to torture Palestinian dissenters. When Palestinians killed a settler last December, Abbas’ forces worked “overtime” to find the culprits arresting hundreds in the process’ .

Such aid also introduces neoliberal policies (and alongside, its undesirable side-effects) into the OPT such as speculation, a form of discredited financial management in the West,

‘… There are fears these projects are attracting foreign speculators. “My message is very clear: there is an economic prize before us, there is a double dividend for you as companies” said British Prime Minister Gordon Brown to a conference of investors in Bethlehem. One such “prize” is the creation of a Palestinian equity market. The Palestine Investment Fund (PIF), the body leading such effort, expects to deliver an annual return of 15 percent. PIF plans to use cash deposits in local banks as well as money from investors to encourage growth in consumer spending. “Our banks have cash deposits of $7 billion, and they are saying there are not enough opportunities to invest,” said Mohammad Mustafa, the Fund’s chief executive and a former World Bank official.

Real Estate is the main target for foreign corporate investment. Rawabi, the first Palestinian planned city, is Fayyad’s flagship project. The Washington Post reported that Rawabi “is specifically designed for upwardly mobile families of a sort that in the United States might gravitate to places such as Reston, VA. The developments are also relying on another American import, the home mortgage, including creation of a Fannie Mae-style institution for the West Bank.” USAID, a branch of the American government, is funneling funds through nongovernmental organizations (NGOs) for the promotion of a mortgage culture in Palestine to support these initiatives from bottom-up. One such example is CHF International, a corporate-led development NGO, which is organizing community level focus groups and technical training as part of their “homebuyer education” program’ .

These policies also promote individualistic consumerist notions and exacerbate class and regional inequalities,

‘… The economic peace model comes with a dose of cultural imperialism. Palestinians do not have basic freedoms but they are being told that they can enjoy the mundane and superfluous in cinemas and shopping centers. This is more vividly seen in wall-encircled Ramallah, the seat of the PA government. High-end clubs are appearing to cater for the western-oriented elite. These spaces draw invisible barriers of class and social status that the majority of people cannot relate to or simply cannot afford. This sort of social stratification inevitably leads to the creation of an individualist and self-interested culture and to contentment for the status quo…

There is also a division being fostered between the urban and the rural populations. The Palestinians living in the 60 percent of the West Bank officially controlled by Israel, also known as Area C, are continuously dispossessed of their land and gradually being pushed to PA-controlled enclaves. The almost exclusive focus of Fayyad’s plan on the service sector, while ignoring the farming community, will inadvertently lead to acceleration of desertification of the rural areas as the young are pulled to new jobs in the city. The Bantustanization process is accelerating with the construction of Israel’s apartheid wall’.

There is nothing new with what the West in particular, the US has done in Palestine. This includes using aid as a political tool (carrot) to advance its interests and promotes its values.

The grand strategy of US foreign policymaking has basically retained the same mould throughout the years: alienate and punish the local political elites (Hamas) and the indigenous population (Gaza residents) that insist on independence from the empire. Promise carrots to the false prophets (PA/ Fatah) who will do part of the dirty work for the Occupier (Israel) in crushing popular dissent. Try to dazzle the rest of the population (West Bank Palestinians) with materialistic goods and values with the hope that they will give up their fight for their most basic civil and political rights and democracy.


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