Israel Has Unfinished Business With an Ally

With his strong victory last week, Israeli Prime Minister-elect Ehud Barak inherits a set of troubled, even poisonous, relations between Israel and the Arab world. Israeli-Palestinian and Israeli-Syrian talks will be tortuous. Relations with Jordan have been correct but are in disrepair. Israel needs to act quickly to keep this relationship, so critical to the peace process and regional stability, from unraveling. However difficult it may be in terms of domestic Israeli politics, there is a critical problem Barak must address: relaxing restrictions on Jordanian exports to the West Bank.

The recent trade statistics are stark. In 1998, the West Bank had a GDP of $2.8 billion. Yet, Jordanian exports to the West Bank last year were held by Israel to a derisory $29 million. If Israel relaxed these restrictions, exports could rise to $300 million. This would jump-start the Jordanian economy.

The reason for the limited trade is no mystery. Israeli businessmen have enjoyed a monopoly over the West Bank market since it became occupied territory in 1967. They want to keep their position. The curious political fact is that neither the Labor government before 1996, nor the current Likud government, has effectively acted to open the doors to Jordanian-West Bank trading.

Such passivity on the part of the Israeli leadership is particularly hard to understand. Of course, protectionism is common in the Middle East and all politicians have to take care of their domestic constituencies. In Israel’s case, however, the higher national interest is being put at risk.

Israel knows it needs prosperity as well as stability in the Hashemite kingdom of Jordan. It knows that there will be no stability if the kingdom is not better able to employ its workers and expand its economy. There have been a few Israeli investments in Jordan, but Amman needs to show its people more benefits from peace than they have yet experienced. It is common knowledge in Amman that King Hussein was more supportive of the Jordanian-Israeli peace treaty than many of his countrymen. There are still doubts and resulting tensions between the palace and many of the population about that treaty. The Jordanian leadership feels somewhat taken for granted by Israel. This is not healthy for the long-term Israeli-Jordanian relationship.

Jordan’s new king, Abdullah II, had been scrupulously careful not to favor any one candidate over another in the Israeli prime ministerial race and has reaffirmed his country’s obligations toward Israel under the peace treaty reached by his late father. Barak should keep Jordan’s economic difficulties under close study and give high priority to whatever Israel can do to ease them.

King Abdullah was in Washington last week on his first official visit. President Clinton warmly welcomed him as friend and leader of a key country helping to ensure stability in the Middle East. The president has committed the United States to a historic high level of assistance for Jordan as well as debt forgiveness. But there is little the president can do directly to promote expanded Jordanian exports to its natural market on the West Bank. Nor should he have to. The problem is one for Israel’s new government to solve.