POTENTIAL CUTS TO REFUGEE "SAFETY NETS" IN GAZA

UNCLAS SECTION 01 OF 04 AMMAN 002474

SIPDIS

SENSITIVE

DEPT FOR PRM AND NEA
NSC FOR MALINE
STATE PLEASE PASS TO USAID

E.O. 12958: N/A
TAGS: PREF PREL KPAL KWBG JO UNRWA
SUBJECT: POTENTIAL CUTS TO REFUGEE "SAFETY NETS" IN GAZA
AND THE WEST BANK

REF: JERUSALEM 961

This cable was cleared by Embassy Tel Aviv and Consulate
General Jerusalem. Message is sensitive but unclassified --
please protect accordingly.


1. (SBU) SUMMARY: With donors currently providing only 20
percent of its requested emergency funds (and earmarking them
heavily to rebuild demolished refugee housing in Rafah),
UNRWA believes it will be forced to scale back its emergency
food and employment programs -- which support fully
three-fourths of the 1.6 million Palestinian refugees in Gaza
and the West Bank -- in July without an immediate, minimum
cash injection of USD 13 million. UNRWA is asking the USG to
make a significant and early contribution to its current USD
185.5 million emergency appeal, as it has over the past four
years, to prevent this potential break in services. The
World Bank and OCHA agree that humanitarian needs will remain
substantial in 2005. They caution that relief agencies need
to maintain current levels of emergency assistance, which has
sustained Palestinians in Gaza and the West Bank over the
last four years, to support economic recovery. Although
access restrictions in Gaza and the West Bank have become
less prohibitive over the last six weeks, OCHA is also
recommending that relief agencies stockpile food and medical
aid before June to counter the possibility the IDF will "lock
down" movement in Gaza to facilitate disengagement. END
SUMMARY.

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WORLD BANK, OCHA ASSESS NEED FOR EMERGENCY REFUGEE AID
-------------- --------------


2. (SBU) Last November, the United Nations Relief and Works
Agency for Palestine Refugees (UNRWA) issued a USD 185.8
million appeal to extend its emergency programming in Gaza
and the West Bank through 2005 -- the eighth appeal UNRWA has
issued since September 2000. UNRWA,s core emergency
programs (food aid, temporary employment, and cash
assistance) are the largest in the region, supporting close
to three-fourths of the 1.6 million Palestinian refugees who
live in Gaza and the West Bank. (NOTE: Palestinian refugees
make up 60 percent of total population of the Strip and 29
percent of the total population of the West Bank. END NOTE.)
Because this emergency appeal was not based on scenarios
that included Israeli withdrawal from Gaza and the northern
West Bank, diplomats representing the top five donors to
UNRWA asked David Shearer, the Director of the UN Office for
the Coordinator of Humanitarian Affairs (OCHA),OCHA Gaza
Field Director Sam Sheppard, and World Bank staff member John
Wetter during a February 21 meeting in Jerusalem to assess
how emergency programming and/or targeting might need to be
revised.

WORLD BANK CAUTIONS AGAINST PREMATURELY SCALING BACK AID
-------------- --------------


3. (SBU) Shearer and Wetter argued that humanitarian needs
will remain significant in both the Gaza Strip and the West
Bank throughout this year, despite the positive developments
that have taken place since the February 8 Sharm-el-Sheik
summit. Although the IDF has taken steps over the last six
weeks to ease some restrictions at Gaza's border crossings
and at its internal Abu Kholi checkpoint -- and has also
reduced internal checkpoints/roadblocks in the West Bank from
700 to 650 -- Shearer stressed that a majority of the
internal and external closures, which the World Bank/PCSB
cite as the main cause of the steady increases in
unemployment, food insecurity, and infant mortality in its
2004 Deep Palestinian Poverty Report, are still in place.
Wetter added that even if one assumes the IDF will continue
to lift access restrictions, the World Bank's "extreme best
case" post-disengagement recovery scenario (i.e., a complete
return to pre-Intifada levels of access to the Israeli labor
market, combined with development programs that create
foreign markets for the Palestinian economy) does not/not
project unemployment rates dropping quickly enough to warrant
scaling back emergency aid programs this year. (NOTE:
According to the World Bank/PCSB October 2004 Deep
Palestinian Poverty Report, approximately 75 percent of
refugees depend on UNRWA's emergency poverty reduction
programs for survival due to rising unemployment rates that
reached -- using conservative estimates -- 39.7 percent in
Gaza and 23.6 percent in the West Bank in 2004. END NOTE.)


4. (SBU) Wetter and Shearer saw no need for relief agencies
to significantly scale up their emergency programs to respond
to disengagement, but cautioned that failing to maintain
emergency assistance at current levels would deepen poverty,
and increase food insecurity, at a time when many
Palestinians are looking for a "dividend" from the recent
period of calm. (NOTE: In its June 2004 Emergency Food
Security Needs Assessment, the WFP estimated that 586,000
Palestinians in Gaza and the West Bank are at risk of
becoming food insecure, in addition to the 1.3 million
persons who already need food assistance. END NOTE.)

OCHA RECOMMENDS PRE-POSITIONING AID BY JUNE
--------------


5. (SBU) Shearer and Sheppard added that OCHA is concerned
that breaks could develop in the current aid pipeline. They
said that OCHA has been encouraging UN relief agencies to
take precautionary measures in Gaza in case the number of
closures spikes during disengagement, when the IDF could
curtail the movement of humanitarian workers and goods to
facilitate the exit of Israeli settlers. Sheppard said that
WFP and UNICEF participated directly in OCHA-led contingency
planning, and have been stockpiling two months, worth of
emergency food and medical supplies in strategic locations in
the Gaza Strip based on an early OCHA "worst case scenario"
-- a full 90-day lockdown of the Gaza Strip's border
crossings, as well as its main internal crossings, that would
effectively divide it into three or four blocs at Netzarim,
Abu Kholi and Morag. Shearer and Sheppard were unable to
comment on UNRWA's preparedness, noting that UNRWA opted to
conduct its own contingency planning.


6. (SBU) Shearer acknowledged that UNRWA's operations may be
less vulnerable to internal closures than the operations of
other assistance providers, given the large size of its local
staff in Gaza (about 8,400 persons),and that recent press
reporting suggests the IDF hopes to complete disengagement in
the Gaza Strip without a prolonged "lock down." He
nonetheless recommended that UNRWA attempt to pre-position
food and medical supplies scheduled to be delivered in Gaza
this summer before June, explaining that the majority of
UNRWA staff live in the north, in Gaza City, and in the south
at Khan Younis. If the IDF closes Gaza's main junctures, as
it did during last October's Operation Days of Penitence,
UNRWA might not be able to distribute food to refugees in
central Gaza between the Netzarim and Abu Kholi junctions --
an area that houses the four UNRWA Camps of Nuseirat, Bureij,
Maghazi, and Deir el-Balah, with a combined population of
142,135. Wetter added that the October 2004 Deep Palestinian
Poverty Report suggests that rural refugees living outside
UNRWA camps in the Gaza Strip could be particularly
vulnerable if internal closures spike, as they are already
less likely to receive emergency assistance. Shearer thought
it unlikely that aid agencies would face similar access
problems in the northern West Bank, but noted that OCHA is
planning to release a new humanitarian situation report on
the West Bank in April; he explained that OCHA is concerned
that relief agencies could be inadvertently forced to scale
back their aid if donors continue to earmark their
contributions for Gaza.
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UNRWA'S RESPONSE CAPACITY
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7. (SBU) UNRWA Gaza and West Bank Field staff responsible for
developing and implementing the agency's emergency
programming confirmed in separate February 22-March 9
meetings with refcoord that their contingency planning is in
line with that of other UN relief agencies. As in 2004,
UNRWA's primary poverty alleviation vehicle is its direct
food aid program. The agency is attempting to negotiate
access with the IDF to meet its internal target, established
in 2001, to warehouse at any one time supplies sufficient to
conduct two emergency food distribution rounds in Gaza and
the West Bank. Currently, it has sufficient stocks to carry
out the one ongoing distribution round, and needs to bring in
additional food to carry out distribution rounds scheduled
for April and July. (NOTE: To meet 60 percent of the caloric
needs of refugee families living below USD 2/day (an
Agency-wide target for poverty alleviation set prior to the
current Intifada) UNRWA calculates that it will need to
distribute emergency food parcels to 132,000 families in Gaza
(69 percent of registered refugees, up from 67 percent last
year) once every six weeks this year for a total of eight
rounds. In the West Bank, it needs to distribute food to
94,294 families (63 percent of all registered refugees) once
every three months, for a total of four rounds per year.
Since the March 2004 attack on Ashdod port, UNRWA has been
unable to retain this schedule in Gaza. New security
measures limited the movement of humanitarian goods; as of
February, UNRWA had over 700 loaded containers of emergency
food and medicines waiting to be off loaded in Ashdod and 350
empty containers waiting to be transported out of Gaza. END
NOTE.)

UNRWA SECURES TEMPORARY ACCESS AGREEMENT...
--------------


8. (SBU) According to Olaf Mulander, UNRWA,s Chief Field
Logistics/Procurement Officer, UNRWA will be able to
pre-position sufficient food in Gaza for the April round
using a temporary agreement with the IDF to offload 350
containers of food purchased with 2004-year funds from Ashdod
through the military-controlled Sufa border crossing over the
next four weeks. However, Deputy Gaza Field Director
Christer Nordahl told refcoord March 21 that he is still
waiting for a response from the IDF to his request to
increase the number of containers UNRWA can transport via
Sufa from 100/week to 140/week to start pre-positioning food
for its July distribution round. Nordahl thought the IDF
would grant this access and assured refcoord that UNRWA has
sufficient facilities to adequately pre-position these stocks
should the Gaza Strip be divided into blocs; in addition to
rented warehouse space that UNRWA has secured in central Gaza
and at Karni, UNRWA is prepared to use its pre-existing food
distribution centers for vulnerable refugees such as the
disabled.


9. (SBU) However, he thought it unlikely that UNRWA could
supply Gaza using food purchased under last year's appeal.
UNRWA is diverting the remaining 300 containers currently in
Ashdod, along with an additional 255 scheduled to arrive this
month, to the West Bank, using borrowed WFP temporary storage
tents that will be set up on UNRWA school grounds, to ensure
UNRWA has sufficient stocks to carry out an emergency food
round scheduled for April. (NOTE: West Bank Field Deputy
Director Jean Tissot told refcoord February 21 that
pre-positioning within the West Bank might become necessary
if the Jerusalem permit system is tightened as a
disengagement-related security measure. He noted that one of
UNRWA's primary warehouses is located at its East Jerusalem
Field HQ and over 80 percent of his HQ staff reside inside
the West Bank. Tissot is analyzing how staff and supplies
could be relocated to Ramallah to mitigate the impact the
completion of the barrier will have on UNRWA operations if it
creates the so-called "Jerusalem envelope." Apart from
creating new internet connections, he predicted that
additional operating costs would be minimal. END NOTE.)


...BUT MAY CUT BACK AID DUE TO POOR CASH FLOW
--------------


10. (SBU) Currently, UNRWA says it has insufficient funds to
purchase food for additional rounds of distribution.
Although a single food round for Gaza costs about USD 5.8
million and USD 6 million for the West Bank, unobligated
funds raised under the 2004 appeal are limited to USD 3.2
million in Gaza (of which USD 632,000 is earmarked for cash
assistance) and USD 1.37 million in the West Bank. Current
pledges to the 2005 appeal cannot make up the difference as
they are primarily earmarked for UNRWA's lower-priority
emergency housing programs, with only USD 1.3 million
available for food. UNRWA's Gaza deputy director fears that
UNRWA could be forced to scale back its emergency assistance
programs without an immediate cash injection. Nordahl
explained that it requires an average of three months for
humanitarian aid to reach Ashdod under UN tendering rules.
He added that other poverty alleviation programs, including
employment schemes and direct cash assistance, would also be
affected by the current level of earmarking.

DONOR RESPONSE AS OF MARCH 16
=============================

DONOR PLEDGE (USD) EARMARK

Belgium 2,614,380 1,307,190 for food
1,307,190 for indirect
hire programs in the West Bank

Saudi Arabia 20,000,000 100 percent Rafah housing

Japan 15,000,000 100 percent Rafah housing

Flanders, 196,078 100 percent Rafah housing
Belgium

LDS Church 72,000 in-kind aid (oat cereal)

Private 11,382

Total Cash 37,821,840


10. (SBU) UNRWA's ongoing negotiations appear unlikely to
remedy this situation. Although the UAE is considering a USD
5.5 million contribution, UNRWA External Affairs reports that
the UAE has indicated that it wants to earmark its
contributions for housing. Amman- and Jerusalem-based EU
officials also report that Brussels, has taken a decision in
the last two weeks to provide 38 million Euros to the UN,s
2005 consolidated appeal in two tranches (25 million in March
and 13 million in September) in the last two weeks, but only
six million is earmarked for UNRWA (2.5M for emergency food
and 3.5M for emergency employment).


11. (SBU) COMMENT: UNRWA hopes the U.S. and other traditional
emergency appeal donors (e.g., the UK, Sweden) will provide
an early contribution to its 2005 appeal. Although UNRWA
could do more to improve its emergency targeting (refcoord
and USAID Gaza/WB will continue to work with EU counterparts
to push UNRWA to sign an MOU with WFP, for example),it has
created a substantial and necessary buffer in Gaza and the
West Bank. An early and significant contribution to help
UNRWA maintain its direct food aid and emergency employment
programs through 2005 would ensure that sorely needed
assistance is not cut off as a result of
disengagement-related Israeli security measures, at a time
when Palestinians will be looking for dividends and will be
voting in legislative elections. END COMMENT.
HALE