THE GOI'S ECONOMIC PLAN FOR THE NEGEV AND GALILEE

C O N F I D E N T I A L SECTION 01 OF 02 TEL AVIV 002537

SIPDIS

E.O. 12958: DECL: 04/21/2015
TAGS: ECON PREL SENV IS ECONOMY AND FINANCE
SUBJECT: THE GOI'S ECONOMIC PLAN FOR THE NEGEV AND GALILEE

REF: A. 04 TEL AVIV 02901

B. 04 TEL AVIV 03085

C. 04 TEL AVIV 03393

Classified By: Charge d'Affaires Gene A. Cretz for reasons 1.4 (b) and
(d)


1. (C) SUMMARY: Vice Premier Shimon Peres is leading the GOI
effort to consolidate a series of public- and private-sector
development initiatives for the Galilee and Negev regions,
which the GOI will push forward in tandem with disengagement.
To date there remains no comprehensive planning document
that outlines exactly what the GOI plans to do in either
region, and Peres staffers indicated the same to Econoff.
Peres has raised the issue of possible USG assistance for the
development initiative, and Peres staffers told Econoffs that
they hope Congress will include such assistance in a
supplemental package in early autumn. Other GOI officials
have also raised the question of USG assistance with
Washington. To bolster this initiative, the GOI is also
seeking worldwide Jewish philanthropic assistance as a
supplement to the budgetary funds. Peres and staffers have
noted that "quality of life" in the two regions will improve
in the form of improved roads, railway system, industrial
zones, parks and other projects. In the Negev, they claim,
this economic initiative will address the "Bedouin problem"
of rampant unemployment, high population growth, and
substandard living conditions. Israeli-Arab and NGO
communities have raised serious concerns, however, that
development in the northern or southern parts of Israel will
further disenfranchise the Israeli-Arab minority (septel).
They fear that USG support for the initiative will encourage
a more rapid "takeover" of Israeli-Arab lands by the State of
Israel or private Jewish citizens. END SUMMARY.

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Old Plans, New Ideas, Looking Towards Galilee and Negev
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2. (C) "The desert provides us with the best opportunity to
begin again," stated David Ben Gurion in his memoirs. This
vision to populate and use the country's vast desert regions
as an economic springboard has surfaced many times within the
corridors of the GOI. Between 1948-51, the GOI created plans
to shape land development for the first two decades after its
independence. Its main feature: population dispersal with
the clear objective of filling in areas along threatened
borders. By the mid-1960's, the plan became outdated and
much of Israel was no longer sparsely populated nor empty.
The Negev Law passed in 1986 and the Galilee Law passed in
1988 include steps to revive development of both these
regions. Ministries were tasked to work closely with the
Galilee and Negev planning councils for appropriate
allocation of resources for housing, financing of education,
health, tourism, industry, transport, communications,
absorption and immigration. The Negev law was revoked in
2002, but components of the law surfaced in independent plans
that addressed small communal projects.


3. (C) Beginning in 1990, massive immigration into Israel
necessitated a plan to effectively address the population
growth. This new plan was referred to as the "2020" plan.
The Ministry of Interior, the Israel Lands Authority (ILA)
and other organizations focused on creating a non-statutory
master plan to serve as a framework for long-range policy in
Israel. The Negev portion of the 2020 plan focuses on civic
and industrial growth in the southern region. It includes
plans for transportation projects, transfer of military
bases, development of physical infrastructure such as roads
and civil engineering projects, housing of Bedouin into
permanent, recognized settlements, and developing the
information technology sector. Regional planning councils
from the Galilee and the Negev work with the MoI and the ILA
to coordinate projects.

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GOI Plan Big on Goals, Short on Details
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4. (C) Vice Premier Shimon Peres is working to consolidate a
number of existing public- and private-sector initiatives for
the Negev and Galilee regions, consolidating them into a
"strategic development plan" that he says the GOI will strive
to implement in tandem with disengagement. Peres advisor,
Einat Wilf told EconCouns April 14 that U.S. assistance for
development of the Negev and Galilee was "put on the agenda"
with AIPAC and Congress during Peres' recent visit to the
U.S. Peres put forward a figure of USD 250 million each year
for four years, and the GOI hopes Congress will include the
funds as part of a supplemental assistance package in early
autumn. The development plan, Wilf explained, will seek to
mobilize additional funds from the Israeli budget and
worldwide Jewish communities. In a March meeting with A/S
Welch and NSC director Abrams, Peres underlined one of the
primary goals of Negev and Galilee development -- it will
"provide a positive message to the Israeli people, to offset
the negative message of disengagement."


5. (C) Peres staffers explained that the plan will address
"overall quality of life issues" in the Negev and Galilee by
focusing on improved education, housing, and employment
opportunities. Staffer Uri Ben-Porath was not able to
provide the details of these programs, however, explaining
that the GOI hopes private investors will undertake the bulk
of job-creation enterprises, including three planned
high-tech parks throughout the Negev. Large-scale public
sector projects, including a rail line connecting Be'er Sheva
with central Israel, and new Ministry of Defense training
facilities, are also planned but not yet funded. Ben-Porath
emphasized that much of the GOI's direct involvement in the
plan will center on the multi-ministry development initiative
for the Bedouin community, which the Knesset approved in 2003
with an NIS one billion allocation. This initiative will aim
to solve what Peres described to A/S Welch and NSC director
Abrams as the "Bedouin problem" of high unemployment and high
population growth, by relocating some 65,000 Bedouin
currently living in unrecognized villages between Be'er Sheva
and Dimona to GOI designated areas in the Negev region.
Despite a proliferation of GOI offices and outside
consultants tasked with planning and implementing Bedouin
relocation -- including a field office in Be'er Sheva staffed
by Amram Khalaji and several planning engineers -- Ben-Porath
conceded that NIS one billion is "not sufficient to build
even one new town." "We will seek the rest of the money from
other sources," he said, but could not specify whether the
GOI expects USG assistance for this program.

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