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'Ramallah on verge of becoming tech hub for Arab world'
By NIV ELIS
19/02/2014
USAID mission director for West Bank and Gaza: Palestinian economic development improves prospects of peace agreement with Israel.
 
Economic development in the Palestinian territories has eased the political discussions between Israelis and Palestinians, USAID’s mission director for the West Bank and Gaza said on Tuesday.

“Technology and innovation has changed everything despite the fact that nobody believes anything has changed between Israelis and Palestinians,” David Harden said at the Israeli Designed International Development (ID²) conference in Caesarea organized by the Schusterman Family Foundation. “There are tough political negotiations that have to go along. Economics aren’t enough alone, but economics help.”

Advances in technology have led to a situation where there is now an excess of water between the Mediterranean Sea and the Jordan River, meaning that the idea of fighting over it is “an old narrative,” he said.

“It’s no longer a zero sum game. We are merely looking at pricing and distribution,” Harden said.

A week earlier, the topic sparked a diplomatic incident when European Parliament President Martin Schultz, addressing to Knesset, criticized Israel for the lopsided distribution of water between Israel and the Palestinians.

The figures he cited prompted a walkout by Bayit Yehudi, who called him a liar and said the gaps were far lower than Schultz suggested.

Harden also said that new energy resources, whether natural gas or solar energy, have brought the discussion of energy to a point where it is “practically solved. It’s not quite there, but it’s nearly there.”

More than that, development in the real Palestinian economy is promising.

Whereas there were no venture capital funds operating in the West Bank just three years ago, now there are three, plus a seed fund and a USAID initiative to invest $300 million in Palestinian start-ups’ equity. A 350 percent increase in tourism since 2007 is spawning a slew of businesses, and prompting technological upgrades as hotels add wifi and restaurants try to get on the electronic map.

There is a tipping point on the horizon, he said, in which “Ramallah will be an intellectual, tech capital for much of the Arab world. And a lot of that has to do with its relationship with Israel.”

Harden was speaking on a panel on how Israeli entrepreneurship could find use in the developing world.

According to Start-Up Nation author Saul Singer, who also spoke on the panel, the developments in the Palestinian territories were reflective of a larger trend.

“What’s going on in Ramallah is what’s beginning to go on everywhere,” he said. “You’re seeing start-up sectors coming up in almost every country, certainly in every continent, in every region.”

That, said Singer, means Israel needs to think about entrepreneurship differently than it has. Instead of “innovating for” other countries, building bridges and working to “innovate with” them.

Harden agreed that Israel’s influence could profoundly help the Palestinians. A World Bank report in October found that Israeli restrictions cost the West bank $3.4 billion annually (about 35 percent of GDP). If Israel were to help it plug into the ecosystem of research, education and hi-tech, it could go much further.

“Their biggest advantage is that they’re next to Israel, whether people like it or not,” said Harden.
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