Palestinian Authority Prime Minister Salaam Fayad acknowledged that Israeli security needs must be met for there to be cooperation between the two sides, in an interview with The Jerusalem Post on Tuesday. "Adequate cooperation," Fayad said, "is never complete before our security needs and those of Israel have been met. We understand that." "This is a small and rough neighborhood, and we have to do it right, and doing it right requires a new paradigm, a new thinking," he said. Fayad maintained that the PA had done better in dealing with security threats recently, after noting that it faced significant challenges from Hamas following the latter's coup in the Gaza Strip last June. "There was definitely the risk of what happened in Gaza spilling into the West Bank. There's no question about that. The country was teetering on the edge of complete collapse." Fayad spoke to the Post after addressing business leaders, diplomats and public officials at the Aspen Institute, which is trying to encourage investment and economic development in the PA. Security coordination with Israel, he said, "is certainly better than it used to be," and he added that the atmosphere between the two sides had been "friendly" as they met in formal negotiations launched by the conference convened by the United States in Annapolis, Maryland, in November. But Fayad criticized Israel for not easing the situation of Palestinians following Annapolis at the same time that political talks progressed, something that he has suggested threatens the likelihood of reaching a peace agreement by the time US President George W. Bush leaves office in January 2009. "Israel has not done a thing materially on the ground to help us," Fayad charged, adding, "I say this sadly." "Israel is strategically committed to helping strengthen the Palestinian Authority, one that is able to fight terror and to forge a historic agreement of two states for two people," an Israeli official countered. "However, acts of terror from the West Bank, including some [carried out] by elements of the Palestinian Authority, necessitate Israeli security measures." Several Israeli Embassy officials attended Fayad's Aspen address as part of their support of the current diplomatic efforts. Fayad, though, did not spare his own people criticism, particularly when it came to the divisions between the Hamas and Fatah movements. "Our own domestic situation is having some effect on how people look at us," he said, speaking of the international community and particularly the investment the PA is hoping to secure with the help of the Aspen Institute. "We have to demonstrate we're a good bet - with your help and support, we can." The institute recently hosted the launch of a US-Palestinian Private-Public Partnership to encourage and facilitate international business investment. In May, a follow-up conference will be held in Bethlehem to attract companies and expose them to the business opportunities that exist in the PA. Major corporations are expected to announce investment plans in the lead-up to the spring meeting. USAID has already set aside $7 million to fund youth centers to train young Palestinians as they look for career opportunities. Other efforts, such as an Arabic-language international call-center and a small-business loan program, are also in the works. Walter Isaacson, president and chief executive officer of the Aspen Institute, said economic development and political progress reinforced each other. "By building up a middle class with economic and educational opportunities in the West Bank, it will lay the foundation for any peace accord," he told the Post. "I don't think you can really have a stable, long-term peace without also promoting education and economic opportunities for the Palestinians." Fayad, a former PA finance minister, met with US Secretary of State Condoleezza Rice as part of his Washington visit and his efforts to promote the US-Palestinian partnership. Rice is expected to travel to the region soon to follow up on the diplomatic process.