December 14, 2011
In an attempt to initiate dialogue on possible political developments and gauge the ability of the Private Sector to respond to such changes AWRAD held a roundtable discussion attended by leaders of the Palestinian Private Sector.
Among the attendees was Munib Al-Masri the prominent Palestinian businessman and leader of the Palestinian Forum - Muntada. The discussion was centered upon a recent poll conducted by AWRAD that focused on the “Arab Spring”, the UN Initiative, the Palestinian political system and internal issues and priorities.
The meeting was facilitated by Dr. Nader Said, AWRAD’s president, and took place at the AWRAD premises.
In the light of the political developments that have occurred in the Middle East in 2011, collectively referred to as Arab Spring, AWRAD has conducted a survey that aims to measure the likelihood of such political developments occurring in Palestine, and how prepared the Palestinian private sector is in responding to such changes, among other things.
In the first session held to receive feedback on this survey from the leaders of the private sector on the above mentioned questions as well as the data the following issues were raised:
- The likelihood that such political developments, namely revolutions, will occur in Palestine.
- The responses ranged from very unlikely to probable in the medium term if the status quo is not changed. The reasoning for the former rests mainly on the stabilizing effect of the Israeli occupation, both directly, in its vested interest in the stability of the PNA and indirectly as a psychological effect on Palestinians. The relatively young age of the PNA is unlikely to produce such a strong political upheaval as it has simply not been in power long enough to warrant its complete destruction. A seemingly stable two party system with clear constituencies has emerged in Palestine which is a stabilizing factor in the Palestinian Street. Finally it was noted that Arab aid to Palestine may rise as a result of the Arab Spring which will also be a stabilization factor in Palestine as it will foster economic growth and alleviate poverty.
- The latter conclusion, namely that extreme political upheavals are possible if the status quo does not change, rests on the following reasons. The economy of Palestine is driven by donor aid and the tax returns that result from its being primarily based on consumption, which fund the PNA as the largest employer in Palestine and therefore and important factor in economic stability. As such it is extremely susceptible to fluctuations in aid as well as tax returns decreasing as a result of a decrease in the per capita purchasing power of Palestinians. Investment is limited to real estate because no other relatively attractive investment options exist and this is primarily the result of a lack of industry. Therefore, money invested in this sector does not produce economic returns in the form of development, but in the best case may or may not be profitable depending on the term of investment. Inflation in general is problematic in increasing poverty and in particular as a result of easy access to loans. Finally corruption in the private sector was noted as well as the relationship between the public and private sectors which may also be corrupt. This will adversely affect the stability of the PNA as it creates a perception of injustice in the average citizen.
- The likelihood of Islamic based parties coming to power in the wake of a revolution is high in the Arab world and in Palestine, because such parties are very organized and relatively long-lived institutions. This speaks to the fact that there the ground is fertile for political change. Also noted is the silent 40 % of Palestinian citizens that do not vote and do not have any party affiliation. These could be a factor for positive or negative change in future political developments.
- As an aside it was noted that the private sector may be very active in creating positive change as portions of this sector were the first to advocate for the unification of the West Bank and Gaza. Furthermore, the private sector should play an important role in mobilizing the said 40% of Palestinians that are not politically affiliated and do not vote as well as other independents.
- The ability of the Palestinian Private Sector to adapt to such changes should they occur.
- The ability of the Palestinian private sector to meet and adapt to such a political upheaval as a revolution, or a change in power is not very effective according to the responses of the attendees. Any change in donor aid, decrease in purchasing power, or increase in unemployment and poverty will have a negative and substantial affect the Palestinian economy and private sector. This is primarily because the Palestinian economy is based on consumption and investment in real estate. Consequently, it does not enjoy any self – sufficiency and would not be able to produce or import needed resources.
- However, in expounding generally upon the nature of private and governmental cooperation some members expressed their belief that the Palestinian private sector is able to adapt to almost any political change as a result of the said propensity for cooperation with the public sector. This observation, although likely accurate insofar as it describes the ability of the Palestinian economy to adapt, does not preclude the likelihood of a severe economic crash as a result of extreme political change; but only speaks to the ability of the economy to bounce back in its wake.
- The means in which AWRAD as a research institute specializing in polling can assist the private sector in becoming prepared political changes should these occur?
According to the responses of the attendees AWRAD may assist in conducting research on political and economic trends and their causes, on the relationship between the private sector and government and possible corruption, and the lack of industrialization in the Palestinian economy.
Conclusion
The attendees thanked AWRAD for the invitation and taking the initiative in broaching such an important but seldom discussed topic. They also expressed their desire to continue participating in such discussion on various issues of importance to the Palestinian cause.