Today's Situation

THE BUSINESS OF PEACE, July 30, 2007

Yedioth Ahronoth and Maariv both lead their Monday editions with banner headlines about sharp drops in the Tel Aviv Stock Exchange, which fell by over 4 percent in trading on Sunday. Unlike previous occasions when the bourse on Ehad Ha'am Street has tumbled, this drop was not down to the security situation, the precariousness of the government or a terror attack. Instead, it was what analysts are calling a corrective adjustment to the level of the market, which has had a stellar year to date, and in response to falls in bourses from Tokyo to New York.

Elsewhere on its front page, Maariv reports on a new initiative being touted by former British prime minister and new Quartet envoy to the Middle East, Tony Blair, and Prime Minister Ehud Olmert, who are hoping to convene an economic conference of 100 leading Israeli and Palestinian businessmen. According to Ben Kaspit, one of the goals of the conference it to help differentiate between the Hams-controlled Gaza Strip and the West Bank, which is still under the control of Mahmoud Abbas' Fateh government. It is also hoped that the once residents of the West Bank taste 'the economic fruits of  peace,' their compatriots in Gaza will be quick to jump on board. According to the report, Blair also discussed the plan with the prime minister of the Palestinian Authority, Salem Fayyad - himself an economist - who is a great believer in the power of business to fuel peace.

Haaretz, meanwhile, leads with a report that Israel - in a special gesture to Abbas - has agreed to allow 41 Iraqi Palestinians to move to the West Bank. According to the report, the refugees, who had been living camp on the Syria-Iraq border, will undergo a detailed security check to ensure that they are not involved in terrorist activities before they are allowed into the territories.

On the diplomatic front, U.S. Secretary of State Condoleezza Rice and Defense Secretary Robert Gates are due to arrive in the Middle East on Monday, The Jerusalem Post reports. They will visit Saudi Arabia and Egypt, before separate trips to other parts of the region. Rice is scheduled to come by herself to Jerusalem and Ramallah later in the week for talks with Israeli and Palestinian leaders.

U.S. officials say both Rice and Gates are expected to reaffirm America's commitment to regional security against threats from Iran and its nuclear program. The visit comes two days after it was reported that the Bush administration will seek Congress' approval for a $20 billion arms deal with Saudi Arabia and other Gulf States, couple with an increase in military aid to Israel. According to media reports, the Bush administration will on formally announce the arms deals on Monday, as well as the increase in military aid to Israel (from $2.4 billion to $3 billion over the next decade).

Abbas, who is in Moscow for meetings with President Vladimir Putin, has denied Israeli reports that he and Olmert discussed establishing a Palestinian state. Russian Interfax news agency quotes Abbas as saying on his arrival in Moscow that 'media reports have nothing to do with reality.'

The Palestinian leader said he and Olmert had not discussed any concrete political issues, but rather perspectives of dialogue, so that they could hold serious talks in the future. He was responding to a report in Haaretz that Olmert was offering to hold negotiations on the establishment of a Palestinian state.

In the meantime, Israel Radio says Monday that Israel is reportedly checking a list of another 600 Arab prisoners who might be freed in the next few weeks. This claim was made by an unnamed Palestinian source quoted by the Arabic Al Jazeera newspaper. The paper also reported that Olmert Abbas will discuss the list in their scheduled meeting next week. Preliminary discussions reportedly are taking place between with Public Security Minister Avi Dichter and Deputy Defense Minister Matan Vilnai. However, PA minister of prisoners' affairs Ashraf Ajrami denied that he spoke to Al Jazeera about a list, according to the Bethlehem-based Ma'an news agency.

Finally, as Israel marks the second anniversary of the disengagement from Gaza and parts of the West Bank, the man who carried out the plan formulated by Ariel Sharon, Dov Weissglas, said Sunday that Israel is better off having left the Gaza Strip.

Speaking to Channel 2, Weissglas said that the processes which have taken place in the two years since the disengagement from Gaza were all expected, and that Israel's security has been improved by the withdrawal.

'All of the predicted results and all of the expected developments did indeed happen, most of them went in a positive direction from Israel's point of view, others went in a non-positive direction… but everything was foreseen.' Weissglas told Meet the Press.

He added, 'the rise of Hamas and Gaza's falling into its hands created the clear understanding in the Palestinian psyche that Israel is not the Palestinian's society's worst enemy. The fact that 7,500 civilians and four battalions of soldiers are no longer in the center of the Palestinian brimstone, is, in my eyes, the disengagement's main accomplishment.'

Today's Situation || Yesterday's Situation