GOI CLOSES PALESTINIAN HOUSING COUNCIL IN EAST

C O N F I D E N T I A L JERUSALEM 001170

SIPDIS

NEA FOR FRONT OFFICE. NSC FOR ABRAMS/SINGH/PASCUAL

E.O. 12958: DECL: 07/03/2018
TAGS: KWBG PGOV PREL PTER PHUM KPAL IS
SUBJECT: GOI CLOSES PALESTINIAN HOUSING COUNCIL IN EAST
JERUSALEM

REF: A. JERUSALEM 00316

B. JERUSALEM 00172

Classified By: Consul General Jake Walles, per reasons 1.4 (b) and (d)


1. (C) Summary. The Chairman of the Board of the East
Jerusalem-based Palestinian Housing Council (PHC) told POLOFF
that the Israeli Minister of Public Security closed the PHC
July 2, claiming that it is a Palestinian Authority (PA)
agency illegally operating inside Jerusalem. He said the PHC
is a legally registered non-profit organization under Israeli
law and is in no way affiliated with the PA. He said the
closure is a political move and the PHC will fight the
closure in Israeli courts. End Summary.

GOI CLOSES PALESTINIAN LENDING INSTITUTION
--------------


2. (C) The Israeli Ministry of the Interior posted an order
(signed by Minister of Public Security Avi Dichter and dated
June 30, 2008) closing the Palestinian Housing Council (PHC)
in East Jerusalem July 2. The order forbids the PHC or its
employees from operating in Israel or Jerusalem and states
that the PHC is "an agency of the Palestinian Authority
inside the State of Israel," which violates the Interim
Agreement.

PHC: INDEPENDENT OF THE PA;
CLOSURE IS POLITICAL
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3. (C) PHC Chairman Ibrahim Shaaban told POLOFF July 3 that
the PHC has been a legally registered not-for-profit
organization under Israeli law since 1991, predating the
Interim Agreement and the establishment of the PA. He said
the PHC has worked to keep a distance from the PA. It has no
organizational or financial ties to the PA and is legally and
financially separate from housing associations in the
Palestinian territories, although it sometimes cooperates
with such associations. Shaaban added that the PHC abides by
Israeli law and has Israeli auditors. (Note: Shaaban
provided POLOFF with a copy of the PHC's 1991 certificate of
registration and a copy of the recent closure order. End
note.)


4. (C) The closure of the PHC came as a surprise to its
Board of Directors, Shaaban said. He told POLOFF that the
PHC intends to fight the closure in Israeli courts and said
he is convinced the MoI has no evidence against the PHC. He
said the closure of the PHC is a political move intended to
disenfranchise Palestinians in Jerusalem and related to other
Israeli activities against Palestinian institutions in East
Jerusalem.

PHC: LENDING TO PROMOTE SELF-SUFFICIENCY
--------------


5. (C) According to Shaaban, the PHC is a low interest
housing lender whose goal is to reduce the difficulties
associated with construction in East Jerusalem and encourage
East Jerusalemites to become economically self-sufficient.
He said the PHC offers roughly 1.5% interest rates on loans
of around $45,000. Clients must prove they have Municipal
permits for construction before receiving a loan, Shaaban
said. Because the interest rate is low, he said, the PHC
counts on donor funding to sustain its activities. USAID
reported no record of having funded the PHC.

COMMENT
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6. (C) Closing the PHC appears inconsistent with the GoI's
Roadmap obligation to reopen Palestinian institutions in East
Jerusalem. The GoI renewed closure orders against eight
Palestinian institutions in February (Ref A),and closed the
Social Forum Organization in Sur Baher that same month.

WALLES