PALTRADE OFFICER ON SETTLEMENT GREENHOUSES, PAPA

1. (C) Summary: PalTrade cash crops officer Hashim
Al-Hussaini spoke to Econoff February 9 on Gazan agribusiness
and job creation post-disengagement. On settlement assets,
Hussaini emphasized the need for direct GOI-PA security
coordination in order to safeguard greenhouses and other
infrastructure during the pullout, arguing that
Israeli-Palestinian dialogue on logistics such as third-party
transfer or settlement inventory are less crucial at this
juncture. Hussaini was enthusiastic about USAID's
Palestinian Agribusiness Partnership Assistance (PAPA)
program, urging the USG to ignore what he called politically
driven complaints of lack of prior USAID-PA coordination.
Gazan firms had responded eagerly to the project, he said,
which will create "thousand of jobs" and build agribusiness
capacity in the long term. He warned, however, that in order
for Gazan agribusiness to succeed the USG must find a way to
guarantee continued water supply to settlement greenhouses
and to ensure market access for Gazan products regardless of
the status of GOI closures. End summary.



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GOI-PA Coordination Needed on
Safeguarding Assets During Transfer


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2. (C) Hashim Al-Hussaini, head of the Agribusiness Trade
Development and Promotion Project of the Palestine Trade
Center (PalTrade), told Econoff February 9 that unless the
GOI and the PA coordinate closely on security issues
surrounding the Israeli pullout, settlement assets will be
"up for grabs" by armed factions, families with dubious
claims to the land, or Gazan looters. Hussaini said he is
not certain whether the settlements should come under solely
PA control, private ownership, or a mix of the two. He
expressed confidence, however, that as long as greenhouses
and other agribusiness infrastructure remain intact and out
of the hands of "renegades," Gazan firms will be able to put
them to almost immediate use post-disengagement.



3. (C) "Israel knows who to talk to on settlements", he
said. "It's nave of them to say there's nobody." Hussaini
claimed he "knows for sure" that the PA has detailed plans
for receiving and disposing of the settlement assets, and
urged the GOI to turn immediately to Abu Mazen or Musa Arafat
regarding "day of" security issues. (Note and comment:
Hussaini is reportedly related by marriage to Musa Arafat and
may overstate his relevance on this issue. Hussaini appeared
unable to speak in detail about GOI-PA dialogue on
non-security-related settlement asset issues, and declined to
explain what steps must be taken to facilitate Gazan usage of
the assets. End note and comment.)



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PAPA a Big Hit With Gazans Despite PA Complaints


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4. (C) In Hussaini's view, USAID's Palestinian Agribusiness
Partnership Activity (PAPA) project is well-timed and has the
potential to create "thousands of jobs" in the sector.
"Forget the PA complaints" that USAID did not coordinate with
Ministries on the project before issuing the tender, he said.
(Note: The Minister of Planning and the Minister for Cabinet
Affairs separately raised their concerns with USAID. Before
putting the project out to bid, USAID had unsuccessfully
tried to find a POC within the Ministry of Agriculture with
whom to discuss the project. End note.) The Agriculture
Ministry had also been angry at the NGO ACDI-VOCA for alleged
lack of coordination with the PA on its U.S. Department of
Agriculture-funded, small-scale Grants Management program, he
said. (Note: Hussaini may be reflecting the lack of
information sharing in the Ministry of Agriculture, since a
senior advisor to the PA Minister of Agriculture sits, along
with ConGenOffs and USDA's Agricultural Specialist at Embassy
Tel Aviv, on ACDI-VOCA's Food Security Committee -- the body
which reviews all of ACDI-VOCA's USDA-funded small-grants
proposals. End note.) In Hussaini's view, "conspiracy
theorists" within the PA criticize any U.S.-affiliated
project for political reasons.



5. (C) Gazan firms "jumped on" the PAPA tender, Hussaini
explained. PAPA will build long-term capacity in the
agribusiness sector, he said, and "inspire" Gazan growers by
giving them access to the top-of-the-line technology inside
settlement greenhouses. Moreover, PAPA is "back on the right
track" -- a step towards long-range development assistance
rather than purely emergency aid, which had been the donor's
focus since the start of the Intifada.



6. (SBU) USAID notes that PAPA is designed to facilitate the
transfer of existing agribusiness in the Gush Katif area and
promote additional agribusiness development in Gaza following
Israeli withdrawal by supporting the refurbishment of
greenhouses, preventing the destruction of capital
investment, and minimizing disruption of operations. The
greenhouses will be placed under the management of a
Palestinian caretaker entity until they can be privatized.
PAPA's operational focus is on Israeli-Palestinian
agribusiness partnerships, which will enable the rapid
transfer of processing technologies following disengagement,
as well as ensure that Gazan growers have continued access to
wider markets through Israel's existing trade links.



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Water and Closures -- Two Main Obstacles
on Settlement Assets


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6. (C) According to Hussaini, PAPA's potential shortfalls
lie in water shortages as well as the GOI's closure regime.
On water, the PA does not have sufficient resources to
irrigate some 4,000 dunams of settlement greenhouses, let
alone 18,000 dunams of fertile "security zone" land that
surrounds the settlement blocs. Hussaini argued that USAID
must guarantee Israel's continued supply of water to the
settlements, noting that the PA would "of course" pay a fee
for this service. On closures, he said, USAID must work with
Israel to provide goods-to-market insurance. "We can grow
world-class produce, but it's worth nothing if we can't ship
it out of Gaza." Any job-creation initiative is welcome, he
said but donors must first address closures.



7. (C) Hussaini's comments underscore the Gazan private
sector's high hopes for the settlement assets, and their
belief that greenhouses can provide extensive benefits to the
Gazan economy post-disengagement. The USG should continue to
encourage direct GOI-PA dialogue on the logistics of transfer
through clear and consistent channels.

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