Looking for salvation in the East

Strategy towards US, Europe on two-state solution could backfire on Israel.

March 22, 2012 11:20
netanyahu cartoon 521

netanyahu cartoon 521. (photo credit: AVI KATZ)

It is nearly three years since Prime Minister Benjamin Netanyahu embraced the two-state idea at Bar-Ilan University. In all that time he has done virtually nothing to make it a reality.

On the contrary, it is becoming increasingly evident that as part of its overall regional strategy his government is determined to hold onto the West Bank indefinitely and to deny the Palestinians any semblance of statehood. After a perfunctory period of diplomatic grace, leading cabinet ministers now say so quite openly. And a strategy for coping with the anticipated international fallout is beginning to emerge.

Most prominently, Education Minister Gideon Sa’ar, in the heart of the Likud consensus, has declared the two-state vision defunct and called on the backroom shapers of Israeli policy to come up with new models.

According to the 45-year-old Sa’ar, seen by many as Netanyahu’s natural successor, establishing a Palestinian state would merely create a springboard for the Arab side to continue the conflict from a position of greater strength. Sa’ar and members of Netanyahu’s inner circle make the same twin-security argument against Palestinian statehood: that Israel needs to retain the West Bank to prevent Gaza-like rocketing of its population centers and as a buffer against the likely emergence from “Arab Spring” turmoil of a hostile Islamist eastern front.

Some of Netanyahu’s closest advisers, including National Security Council Director Yaakov Amidror, insist that to fight potential West Bank terror effectively, the IDF needs to physically occupy Palestinian territory. At the very least, he says, to prevent an influx of weaponry across the eastern border and to face potential threats from a radicalized eastern front, Israel needs to maintain a military presence in the Jordan Rift Valley. Netanyahu himself adds the “Iran first” argument: that Iran must first be weakened and its role as the main arms supplier to Palestinian rejectionists undermined before Israel can safely contemplate accommodation with the Palestinians.

This kind of thinking will almost certainly leave Israel locked into protracted occupation of the West Bank and facing growing international demands to end it. The big challenge for Netanyahu and any future right-wing governments will be how to deflect the pressure.

Eyes on the East

One of the ideas the Netanyahu government is exploring is a major shift in trade from Western Europe to Asia. Although this stems primarily from sound economic thinking based on current European economic woes and Israel’s huge untapped potential for trade with the emerging Asian giants, some on the right are already pointing to possible diplomatic spin-offs further down the road.

They argue that if Israel develops alternative markets, Western Europe, fingered as the likely leader of moves against ongoing occupation, will have less economic and diplomatic leverage. Not only would Israel’s trade network be spread much wider, trading partners in the less human rightsoriented Far East would be less likely to use economic weapons for diplomatic gain.

The eastward drive is being energetically led by Finance Minister Yuval Steinitz. “We are making an effort to divert our exports to China, India and South America in order not to be dependent solely on the West,” he declared at a business conference in Tel Aviv in December. “So far we have been successful: Our exports to emerging markets increased from 30 to 40 percent of the total in just two years.”

In late February, Steinitz made a second trip to China in two years to sign a $300 million financial deal to sell Israeli water technologies to China. Two months earlier he was in India setting up a free-trade zone.

In Beijing, he described increased trade with China as a “top strategic goal.” Last year the volume of Sino-Israel trade reached $8 billion, up from $6.7 billion in 2010. Indo-Israel trade increased even more dramatically, up to $5 billion last year from $2.9 billion in 2010. Mark Sofer, Israel’s former Ambassador to New Delhi, expects it to grow to a game-changing $15 billion within four years.

Over the years, Netanyahu has developed two other stratagies to enable him to have his cake and eat it too – what he calls “economic peace” with the Palestinians – that is helping to create a flourishing economy in the West Bank and so reducing the Palestinian incentive to return to armed struggle – and containing American presidential initiatives by pulling strings in a pro-Israel Congress.

Netanyahu’s flawed cake

None of this makes a whole lot of sense. With an annual trade volume of $37 billion in 2011, the EU remains by far Israel’s largest trading partner. There is a strong scientific and high-tech mesh that fuels trade and innovation. Israel gets strategic goods from Europe it could not get elsewhere, for example, German-built Dolphin submarines.

Moreover, the Netanyahu government has itself acknowledged the EU’s unique moral authority in international affairs. When Europe opposed Palestinian moves for UN recognition last year, Israel spoke of having achieved a “moral majority.”

Secondly, trying to play Congress off against the president is, to say the least, not very smart. It puts Israel’s most vital strategic relationship at risk. It is also less likely to be effective against a second-term incumbent.

The chances are President Barack Obama will be reelected in November and will start pressing Israel to cut a deal with the Palestinians.

The key is in Washington. If the post-election American administration sets a determined end the occupation tone, Europe will follow. The scope of Israel’s trade in emerging markets will make little difference. As for Netanyahu’s notion of economic peace, it is unlikely to hold for much longer without a significant political correlative.

The Netanyahu government’s conclusion from recent events – the rockets from Gaza and the Arab Spring – has been that it is too risky for Israel to withdraw from the West Bank. But the opposite conclusion could also be drawn. The staggering success of the Iron Dome system in shooting down the Gaza rockets suggests Israel is now actually better placed to consider a West Bank pullout.

Moreover, the Arab Spring may have radicalized Arab thinking, but in weakening or toppling the old regimes, it has reduced Arab military options.

For the sake of the moral high ground, for relations with the US, Europe, the region and even the Far East – and, more importantly, for its future as a Jewish and democratic state – Israel would be far better off leaving the West Bank than looking for ways to help maintain the occupation.

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