Abir Dandis, the mother of the two girls who were murdered in the Negev town of Al-Fura’a last week, couldn't find a police officer to listen to her warnings, neither in Arad nor in Ma’ale Adumim. Both police stations operate in areas where Israel wants to gather the Bedouin into permanent communities, against their will, in order to clear more land for Jewish communities. The dismissive treatment Dandis received shows how the Bedouin are considered simply to be lawbreakers by their very nature. But as a resident of the West Bank asking for help for her daughters, whose father was Israeli, Dandis faced the legal-bureaucratic maze created by the Oslo Accords.

The Palestinian police is not allowed to arrest Israeli civilians. It must hand suspects over to the Israel Police. The Palestinian police complain that in cases of Israelis suspected of committing crimes against Palestinian residents, the Israel Police tend not to investigate or prosecute them.

In addition, the town of Al-Azaria, where Dandis lives, is in Area B, under Palestinian civilian authority and Israeli security authority. According to the testimony of Palestinian residents, neither the IDF nor the Israel Police has any interest in internal Palestinian crime even though they have both the authority and the obligation to act in Area B.

The Palestinian police are limited in what it can do in Area B. Bringing in reinforcements or carrying weapons in emergency situations requires coordination with, and obtaining permission from, the IDF. If Dandis fears that the man who murdered her daughters is going to attack her as well, she has plenty of reason to fear that she will not receive appropriate, immediate police protection from either the Israelis or the Palestinians.

Dandis told Jack Khoury of Haaretz that the Ma’ale Adumim police referred her to the Palestinian Civil Affairs Coordination and Liaison Committee. Theoretically, this committee (which is subordinate to the Civil Affairs Ministry) is the logical place to go for such matters. Its parallel agency in Israel is the Civilian Liaison Committee (which is part of the Coordination and Liaison Administration - a part of the Civil Administration under the Coordinator of Government Activities in the Territories).

In their meetings, they are supposed to discuss matters such as settlers’ complaints about the high volume of the loudspeakers at mosques or Palestinians’ complaints about attacks by settlers. But the Palestinians see the Liaison Committee as a place to submit requests for permission to travel to Israel, and get the impression that its clerks do not have much power when faced with their Israeli counterparts. In any case, the coordination process is cumbersome and long.

The Palestinian police has a family welfare unit, and activists in Palestinian women’s organizations say that in recent years, its performance has improved. But, as stated, it has no authority over Israeli civilians and residents. Several non-governmental women’s groups also operate in the West Bank and in East Jerusalem, and women in similar situations approach them for help. The manager of one such organization told Haaretz that Dandis also fell victim to this confusing duplication of procedures and laws. Had Dandis approached her, she said, she would have referred her to Adalah, the Legal Center for Arab Minority Rights in Israel, which has expertise in navigating Israel’s laws and authorities.

John Kerry revealed his long-awaited plan for peace in the Middle East on Sunday, hinging on a $4bn (£2.6bn) investment in the Palestinian private sector.

The US secretary of state, speaking at the World Economic Forum on the Jordanian shores of the Dead Sea, told an audience including Israeli president Shimon Peres and Palestinian leader Mahmoud Abbas that an independent Palestinian economy is essential to achieving a sustainable peace.

Speaking under the conference banner "Breaking the Impasse", Kerry announced a plan that he promised would be "bigger, bolder and more ambitious" than anything since the Oslo accords, more than 20 years ago.

Tony Blair is to lead a group of private sector leaders in devising a plan to release the Palestinian economy from its dependence on international donors. The initial findings of Blair's taskforce, Kerry boasted, were "stunning", predicting a 50% increase in Palestinian GDP over three years, a cut of two-thirds in unemployment rates and almost double the Palestinian median wage. Currently, 40% of the Palestinian economy is supplied by donor aid.

Kerry assured Abbas that the economic plan was not a substitute for a political solution, which remains the US's "top priority".

Peres, who had taken the stage just minutes before, also issued a personal plea to his Palestinian counterpart to return to the negotiations.

"Let me say to my dear friend President Abbas," Peres said, "Should we really dance around the table? Lets sit together. You'll be surprised how much can be achieved in open, direct and organised meetings."

Thick locks hug the front gates of shuttered shops, now covered in graffiti and dust from lack of use. Only a handful of customers pass along the dimly lit road, sometimes stopping to check the ripeness of fruits and vegetables, or ordering meat in near-empty butcher shops.

“All the shops are closed. I’m the only one open. This used to be the best place,” said 64-year-old Mustafa Sunocret, selling vegetables out of a small storefront in the marketplace near his family’s home in the Muslim quarter of Jerusalem’s Old City.

Amidst the brightly coloured scarves, clothes and carpets, ceramic pottery and religious souvenirs filling the shops of Jerusalem’s historic Old City, Palestinian merchants are struggling to keep their businesses alive.

Faced with worsening health problems, Sunocret told IPS that he cannot work outside of the Old City, even as the cost of maintaining his shop, with high electricity, water and municipal tax bills to pay, weighs on him.

“I only have this shop,” he said. “There is no other work. I’m tired.”

Abed Ajloni, the owner of an antiques shop in the Old City, owes the Jerusalem municipality 250,000 Israeli shekels (68,300 U.S. dollars) in taxes. He told IPS that almost every day, the city’s tax collectors come into the Old City, accompanied by Israeli police and soldiers, to pressure people there to pay.

“It feels like they’re coming again to occupy the city, with the soldiers and police,” Ajloni, who has owned the same shop for 35 years, told IPS. “But where can I go? What can I do? All my life I was in this place.”

He added, “Does Jerusalem belong to us, or to someone else? Who’s responsible for Jerusalem? Who?”

Illegal annexation

Israel occupied East Jerusalem, including the Old City, in 1967. In July 1980, it passed a law stating that “Jerusalem, complete and united, is the capital of Israel”. But Israel’s annexation of East Jerusalem and subsequent application of Israeli laws over the entire city remain unrecognised by the international community.

Under international law, East Jerusalem is considered occupied territory – along with the West Bank, Gaza Strip and Syrian Golan Heights – and Palestinian residents of the city are protected under the Fourth Geneva Convention.

Jerusalem has historically been the economic, political and cultural centre of life for the entire Palestinian population. But after decades languishing under destructive Israeli policies meant to isolate the city from the rest of the Occupied Territories and a lack of municipal services and investment, East Jerusalem has slipped into a state of poverty and neglect.

“After some 45 years of occupation, Arab Jerusalemites suffer from political and cultural schizophrenia, simultaneously connected with and isolated from their two hinterlands: Ramallah and the West Bank to their east, West Jerusalem and Israel to the west,” the International Crisis Group recently wrote.

Israeli restrictions on planning and building, home demolitions, lack of investment in education and jobs, construction of an eight-foot-high separation barrier between and around Palestinian neighbourhoods and the creation of a permit system to enter Jerusalem have all contributed to the city’s isolation.

Formal Palestinian political groups have also been banned from the city, and between 2001-2009, Israel closed an estimated 26 organisations, including the former Palestinian Liberation Organisation headquarters in Jerusalem, the Orient House and the Jerusalem Chamber of Commerce.

Extreme poverty

Israel’s policies have also led to higher prices for basic goods and services and forced many Palestinian business owners to close shop and move to Ramallah or other Palestinian neighbourhoods on the other side of the wall. Many Palestinian Jerusalemites also prefer to do their shopping in the West Bank, or in West Jerusalem, where prices are lower.

While Palestinians constitute 39 percent of the city’s population today, almost 80 percent of East Jerusalem residents, including 85 percent of children, live below the poverty line.

“How could you develop [an] economy if you don’t control your resources? How could you develop [an] economy if you don’t have any control of your borders?” said Zakaria Odeh, director of the Civic Coalition for Palestinian Rights in Jerusalem, of “this kind of fragmentation, checkpoints, closure”.

“Without freedom of movement of goods and human beings, how could you develop an economy?” he asked.

“You can’t talk about independent economy in Jerusalem or the West Bank or in all of Palestine without a political solution. We don’t have a Palestinian economy; we have economic activities. That’s all we have,” Odeh told IPS.

Israel’s separation barrier alone, according to a new report by the United Nations Conference on Trade and Development (UNCTD), has caused a direct loss of over one billion dollars to Palestinians in Jerusalem, and continues to incur 200 million dollars per year in lost opportunities.

Israel’s severing and control over the Jerusalem-Jericho road – the historical trade route that connected Jerusalem to the rest of the West Bank and Middle East – has also contributed to the city’s economic downturn.

Separation of Jerusalem from West Bank

Before the First Intifada (Arabic for “uprising”) began in the late 1980s, East Jerusalem contributed approximately 14 to 15 percent of the gross domestic product (GDP) in the Occupied Palestinian territories (OPT). By 2000, that number had dropped to less than eight percent; in 2010, the East Jerusalem economy, compared to the rest of the OPT, was estimated at only seven percent.

“Economic separation resulted in the contraction in the relative size of the East Jerusalem economy, its detachment from the remaining OPT and the gradual redirection of East Jerusalem employment towards the Israeli labour market,” the U.N. report found.

Decades ago, Israel adopted a policy to maintain a so-called “demographic balance” in Jerusalem and attempt to limit Palestinian residents of the city to 26.5 percent or less of the total population.

To maintain this composition, Israel built numerous Jewish-Israeli settlements inside and in a ring around Jerusalem and changed the municipal boundaries to encompass Jewish neighbourhoods while excluding Palestinian ones.

It is now estimated that 90,000 Palestinians holding Jerusalem residency rights live on the other side of the separation barrier and must cross through Israeli checkpoints in order to reach Jerusalem for school, medical treatment, work, and other services.

“Israel is using all kinds of tools to push the Palestinians to leave; sometimes they are visible, and sometimes invisible tools,” explained Ziad al-Hammouri, director of the Jerusalem Centre for Social and Economic Rights (JCSER).

Al-Hammouri told IPS that at least 25 percent of the 1,000 Palestinian shops in the Old City were closed in recent years as a result of high municipal taxes and a lack of customers. “Taxation is an invisible tool…as dangerous as revoking ID cards and demolishing houses,” he said. “Israel will use this as pressure and as a tool in the future to confiscate these shops and properties.”

Gaza City - Palestinian prime minister Ismail Haniya was adamant that Hamas would not recognise Israel and outright rejected huge international pressure to soften the stance of his ruling Islamist movement.

"We will not recognise Israel, we will not recognise Israel, we will not recognise Israel," Haniya thundered in a speech before tens of thousands of Hamas supporters rallying in support of his embattled Palestinian government.

The prime minister instead repeated that his movement would be willing to enter into a truce with the Jewish state in exchange for a Palestinian state created on land occupied by Israel in the 1967 Middle East war.

"We are for the creation of a Palestinian state on the territories occupied in 1967 with Jerusalem as its capital in exchange for a truce but not recognition of Israel, which would amount to renouncing the land of our ancestors," he added.

Israel has always rejected any question of a truce and demands that any Palestinian government accept conditions laid down by the international community as a means to resuming dialogue and ending a damaging boycott.

Insisting that Hamas recognise Israel, renounce violence and abide by past peace agreements, the West suspended direct aid after the Islamists took office last March, saddling the Palestinians with an unprecedented fiscal crisis.

But Haniya rejected "diktats" imposed by the four sponsors of the Middle East peace process, the European Union, Russia, United Nations and United States, known as the quartet.

"We reject foreign interference in the affairs of the Palestinian people and the diktats of the quartet," Haniya said.

"We insist on non-recognition of the legitimacy of occupation and we will never renounce an inch of our land, refugees' return and the creation of a Palestinian state enjoying full sovereignty with Jerusalem as its capital."

The premier heavily critcised the US administration, blaming Washington for the boycott of his government and denouncing "conspiracies" seeking to bring down his cabinet.

"Foreign and local parties are allied to impose an immoral siege on us and prevent our government from properly carrying out its schemes," he said.

"This siege is orchestrated by the American administration that wants to bring the Palestinian people and its government to their knees," he added.

Although the West considers Hamas a terrorist organisation, Haniya insisted his government had the legitimacy of being elected and could not be overthrown.

"I say to certain brothers and certain parties who are working day and night to bring down the government: do not tire yourself," he shouted.

The 43-year-old prime minister appeared briefly unwell at one point, turning pale and looking unsteady on his feet, before being helped away from the podium and onto the ground by bodyguards amid the intense afternoon heat.

Yet Haniya, who is observing the Muslim fast of Ramadan, under which the faithful can neither eat nor drink from sunrise to sunset, managed to resume his speech within minutes as an aide fanned his back.

Tens of thousands of Palestinians packed the city's main sports stadium to hear Haniya speak, carrying enormous fluttering banners in the Islamist movement's trademark green and wearing baseball caps in the same colour.

The demonstration comes at a time of stalemate in talks with Hamas and Palestinian president Mahmud Abbas's Fatah party on forming a national unity government, billed as a means to exit the ever deepening crisis.

Deprived of international aid and customs duties owed by Israel since taking office last March, the Hamas-led government is practically bankrupt and civil servants have not received their full salaries for six months.

Tensions between supporters of Fatah and Hamas have spilled over into deadly clashes in recent days, leaving 12 people dead and more than 100 wounded.

Gaza City - Palestinian president Mahmud Abbas's Fatah and rivals Hamas were trading demands for a unity government that run the risk of delaying its formation and any subsequent lifting of Western aid embargoes.

As talks dragged on in the Gaza Strip Friday, European Union foreign ministers were meeting in Brussels to discuss a possible resumption of aid, despite the United States urging them not to rush into a decision.

A political adviser to outgoing Hamas prime minister Ismail Haniya, to be charged with forming the new cabinet, said the Islamists wanted twice the number of cabinet posts as Abbas's moderate Fatah party.

Ahmed Yussef told AFP that given the radical Islamist movement won 74 seats to Fatah's 45 in January's parliamentary election, Hamas should have eight to 10 cabinet portfolios to the moderate Fatah's four or five.

"These are recommendations and not demands," said Yussef. "We are the majority in parliament with more than 70 seats, so we are supposed to have double the portfolios. We think this is logical," he said.

But Yussef did concede that key portfolios such as finance and foreign affairs, likely to have the most contact with the outside world, should go to independents "to avoid disagreements and polarisation".

He said discussions were concentrating on putting the "finishing touches" to the government's platform as accepted by Haniya and Abbas on Monday, with talks on the names of ministers due to begin in the coming days.

Friday was the first time since Abbas and Haniya agreed the policy outline that Hamas had made such precise demands after conceding that a coalition cabinet was necessary following six months of unparalleled crisis.

Abbas has also made demands, namely that Hamas officials detained by Israel and an Israeli soldier captured more than two months ago and held in the Gaza Strip by militants should be released before the new unity cabinet is announced.

"Before this government is announced, several things need to be resolved: the problem of the Israeli soldier and that of the detained Palestinian prisoners, MPs and ministers," he told reporters late Thursday.

Speaking after talks with visiting French Foreign Minister Philippe Douste-Blazy, Abbas also said the announcement of a new government depended on a complete lack of violence in the Palestinian territories.

Fatah spokesman Maher Maqdad appeared irritated by the Hamas demands on Friday, which he slammed as "haggling and pressure".

Palestinians hope that a coalition government will end an unprecedented political and fiscal crisis plaguing the territories since March, when Hamas came to power, through expectations that the West will lift a freeze on direct aid.

The European Union and the United States have demanded that Hamas, which they and Israel consider a terrorist organization, renounce violence, recognize the Jewish state and agree to abide by previous peace agreements.

In Brussels, the EU's Finnish presidency said that the 25-member bloc should welcome the Palestinian unity government as an opportunity to renew the stalled Middle East peace process.

"We have a new Palestinian government, we have a new situation and we should use it to get back to the peace process," said Finnish Foreign Minister Erkki Tuomioja ahead of Friday's meeting of EU foreign ministers.

"The formation of a Palestinian government of national unity which takes into account the objectives of the international community would constitute a major evolution," his French counterpart Philippe Douste-Blazy said.

Washington, however, has remained sceptical in the absence of details on policy and on the role of Hamas.

"At this point, we don't see any qualitative change in the situation vis-a-vis the Palestinian Authority and its policies," State Department spokesman Sean McCormack said late Thursday.

Gaza City - Life in the Gaza Strip has become "miserable and dangerous" after six months of fiscal and political crisis, John Ging, the head of the United Nations Relief and Works Agency, told AFP in an interview.

"Every day seems to get worse. The prospects are very bleak because we have seen nothing in six months but deterioration," he said Wednesday.

"All the elements of a civilised existence are falling apart: there is a lack of food, no electricity, no salaries, the public services are crumbling."

On March 29, the first Hamas-led government was formally sworn in by Palestinian president Mahmud Abbas. Within days, the European Union and United States suspended direct aid to the Palestinian Authority.

The masterminds of 10 years of suicide bombings, Hamas is blacklisted as a terrorist organisation in the West, although its armed wing has not claimed any such attack in Israel for more than one year.

Israel separately froze the transfer of customs payments levied on goods routing through the Jewish state en route to the Palestinian territories and tightened closures on the Gaza Strip, the base of the Hamas-led administration.

As a result, tens of thousands of civil servants have only been partially paid for the last six months, affecting the livelihoods of around one million people -- a quarter of those living in Gaza and the West Bank.

The living conditions of the 1.4 million people living in Gaza, one of the most densely populated places on earth, have deteriorated sharply owing to the cut in Western aid, Israeli closures and Israel's ongoing offensive in Gaza.

"Life in Gaza is miserable and dangerous. There have been more than 200 killed during the last couple of months, among them 44 children," said Ging.

On Saturday, public workers went on an open-ended strike in order to demand better pay, in mass industrial action that Palestinian prime minister Ismail Haniya has warned may have "dangerous consequences".

Since March, Ging says the UN has added another 100,000 people to the number benefiting from food aid, an increase of 15 percent to a total of 830,000.

Living conditions further nosedived after Israeli jets bombed the only power plant in the Gaza Strip in late June, subjecting the crowded territory to stringent electricity and water rationing.

A recent UN report said Gazans get between six and eight hours of power a day and families in built-up areas get two or three hours of running water.

The shortages have paralysed water treatment and sewage systems, having a spin-off effect on health, seeing a jump in diarrhea, particularly among children, the UN has warned.

Ging attributed survival to a strong sense of community.

"They live on few resources and they are heavily in debt. Some can survive with very little but there is a point of collapse," he said, admitting that unlike elsewhere around the world, Palestinians are not dying of hunger.

Even more serious, he believes, is Israel's closure of the Gaza Strip.

"The border closures have destroyed the economy and the prospect of a peaceful future. The key in any country is the economy but the closure kills that off. We have to give the children a prospect for the future," he said.

Since March 12, no Palestinian worker has been allowed into Israel and the only transit point for goods, at Karni, has been open only intermittently.

The Israeli military has said crossings have been closed owing to persistent security alerts, and that some supplies have been allowed to get through.

At a donor conference in Stockholm last week, UN relief coordinator Jan Egeland implored states to dig deep to help the Palestinian people, stressing the need for an immediate end to hostilities and improved access.

"As said Egeland in Stockholm: it's a ticking bomb. We should hear the ticking. We are going towards a social explosion," Ging warned.