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.”

In a rare speech to an Israeli audience, Palestinian Authority Prime Minister Salam Fayyad said Tuesday that Israel must show the Palestinians that it is beginning to roll back the occupation, and that the way to do that is primarily by stopping both settlement construction and IDF incursions into Palestinian areas.

Fayyad, addressing the 10th Herzliya Conference immediately after Defense Minister Ehud Barak, said in a speech delivered in a conciliatory tone that the problem with settlement construction was that not only was it eating up territory where the Palestinians hoped to build a state, but that the inability to stop the construction raised doubts among the Palestinians as to whether any Israeli government could implement a future agreement.

“The Palestinian state is supposed to emerge precisely where settlements are expanding,” he said. “The political question I have is how confident can we be that once relaunched, the political process is going to be able to deliver that which needs to be delivered on the permanent status issues, on the key question of ending the occupation,” Fayyad said.

He said that the PA is sensitive to Israel’s security needs, and that “given that security conditions have so vastly improved,” the time for IDF incursions into areas under Palestinian control has come to an end.

“In fact, what would create all of this in a context of an occupation to be ended, is for us Palestinians to have formal security presence in other population areas outside of Area A, because nothing – as anyone will tell you – defines a state more than where its own security service[s], not the occupation security services, are,” he said.

This move, Fayyad added as Barak looked on, would give Palestinians confidence that Israel really intended to end the occupation.

The PA prime minister, speaking in English and warmly received, reiterated the Palestinians’ claim to east Jerusalem, saying this was no less land occupied by Israel in 1967 than the West Bank and the Gaza Strip.

Regarding Gaza, Fayyad said it was essential that “our country be reunified,” and that lifting the blockade of the Gaza Strip would go along way toward enabling the PA to reassert control there. He said that the PA could move faster toward building government institutions in Gaza, then it has done in the West Bank, because the area is smaller.

Fayyad outlined the steps his government was taking to build its governing capacity, saying that he hoped that by mid-2011 the institutions would be in place that would be able provide a good level of services – social, economic and security – to the Palestinians.

The hope, he admitted, was that once the world saw that the Palestinians had the ability to effectively govern themselves, the pressure would rise to bring about an end to the occupation.

Fayyad mentioned on a number of occasions the Palestinians’ recognition in 1988 of Israel’s right to live in peace and security, and said that the PA was not wavering from that commitment.

And just as the Palestinians recognized Israel’s right, so to the concept of two states must be accepted in Israel, he said.

Referring to a comment Barak made about the “roughness” of the region, Fayyad said “the roughness of this neighborhood can be reduced if not eliminated if occupation comes to an end.” He said permanent peace was not possible unless “the concept of Palestinian statehood is accepted.”

In a conciliatory statement to end his address, Fayyad said, “The Israeli people have a long history, they have pain, they have ambition, and like you, we Palestinians have our own history. Right now we are going through lots of pain and suffering. And we have one key aspiration, and that is once again to be able to live alongside you in peace, harmony and security.”

Barak, in his address, praised Fayyad for his work in developing Palestinian infrastructure, and said that the Israel faced a cruel reality.

There are 12 million people living between the Jordan River and the Mediterranean Sea, he said – 7.5 million Israelis and 4.5 million Palestinians. If there is one state in that area, he said, it will necessarily either be not Jewish or not democratic. “If that block of millions of Palestinians vote, then there will be a binational state, and if they don’t vote, then there will be an apartheid state. Neither is the Zionist dream.”

He said that “good fences make good neighbors,” and that it would take one to two years to reach an agreement with Palestinians, and another three to implement it. The most difficult decisions Prime Minister Binyamin Netanyahu and PA President Mahmoud Abbas will have to make, he said, will be not regarding the other side, but toward their own people.

Barak called on the religious Right to realize that during the two periods of Jewish commonwealths in the distant past, the borders of the land were determined based on the political realities of the time. At the same time, he called on the Left not to be naïve.

There will only be peace, Barak said, when Israel’s enemies realize that it can’t be defeated militarily, worn down by terrorism, or entrapped diplomatically.

If Palestinian Authority President Mahmoud Abbas gives his nod, the “proximity” talks that US Mideast envoy George Mitchell will mediate will start with a basic question – how each side perceives a two-state solution – then move from there, Marc Otte, the European Union’s Mideast envoy, told The Jerusalem Post on Sunday.

According to Otte, once each party defined its vision of a two-state solution and some common ground was found, the role of the mediator would be to convince each side that the vision was implementable, and that the other side was capable of fulfilling its end of the bargain.

These talks would also have a regional dimension, he said, since the various actors in the region “have a say in the matter as well.”

The regional actors, he said, would be asked to articulate what they were willing to give to move the process forward, a throwback to US President Barack Obama’s idea in the early days of his presidency that the Arab countries would ante up gestures to Israel as a way of building Israeli confidence, even as Israel made gestures to the Palestinians.

According to Otte, it would be a mistake to see the Saudi refusal last summer to positively answer Obama’s calls for gestures toward Israel as solely related to the Israeli-Palestinian conflict; he said that it also had something to do with hiccups in the US-Saudi relationship, particularly Saudi concern over US policy in Iraq, and the fear that a US troop withdrawal there would lead to chaos and increased Iranian influence that could threaten the Persian Gulf.

Beyond the proximity talks, Mitchell’s thrust was also currently on changing the situation on the ground, with the efforts focused on getting Israel to give the Palestinian Authority additional “physical, political, economic and social space” to develop so that Israel was not stuck – when the day came – with a dysfunctional state on its border, Otte said.

This included, he said, extending the West Bank areas where the Palestinians have full security and administrative responsibility.

Otte said that Israel should do what it could to create optimism among Palestinians, facilitate Palestinian economic growth, and help PA Prime Minister Salam Fayyad implement his plan to build Palestinian governing institutions.

However, Otte said that alongside with this there would be the need for a political process.

“How long will a Palestinian policeman arrest a relative if he doesn’t see that it is leading anywhere?” he said.

Otte acknowledged that there was much concern about the spoiler role that Iran –through Hamas and Hizbullah – could play, and that no one was quite clear about how to neutralize that threat.

He said that a meeting of the Quartet – the US, EU, Russia and UN – was possible later in February, but was unlikely until Abbas responded to the ideas – including the proximity talks – that Mitchell brought with him two weeks ago.

Meanwhile, National Security Adviser Uzi Arad said at the opening session of the 10th Herzliya Conference that while here was a great deal of “potential” in the diplomatic process, it was “impossible to deny that the Palestinians are the ones who are being obstinate.”

Arad said that this “policy of refusal” was not just evident now, but was also responsible for Abbas’s rejection of then-prime minister Ehud Olmert’s “generous offer” 18 months ago.

Speaking of Abbas, Arad said “once he is too strong, once too weak, once is waiting for elections, other times he’s moody, and at a different time he’s waiting for an Arab League conference. But the policy remains the same – refusal – and it is disappointing.”

Arad said that the US, which he termed Israel’s “indispensable” ally, was continuing with its effort to restart the talks, and that it was fair to hope that the talks would commence in the “short- or mid-term.”

Perhaps tellingly, Arad during his talk made reference – but did not endorse – a paper published recently by one of his predecessors at the National Security Council, Giora Eiland, on alternatives to a two-state solution. One of the ideas in that paper was for a “United States of Jordan,” with Jordan a federation of three states, the East Bank, West Bank and Gaza.

Regarding Iran, Arad said that the international community, led by the US, was on the verge of ratcheting up the pressure on Teheran.

He said the US was acting wisely and with prudence, and – citing a piece in Sunday’s Jerusalem Post – noted that his US counterpart, James Jones, had praised the serious, continual dialogue with Israel on this matter.

The Palestinian Authority is pushing Israel to agree to a total construction freeze, in both the settlements and east Jerusalem, of between three to six months, something senior Israeli officials said Prime Minister Binyamin Netanyahu will not agree to, The Jerusalem Post has learned.

This is one idea that US Middle East envoy George Mitchell is expected to raise during talks with Netanyahu on Thursday. Mitchell, who has not been to the region since early November, is scheduled to arrive on Wednesday and stay through Saturday.

He is set to arrive after two days of talks in Lebanon, and - in addition to going to the PA - is also expected to go to Syria during this visit.

The call for a complete freeze, including in Jerusalem, for a short period is viewed as an attempt by PA President Mahmoud Abbas to return to negotiations without "losing face," since he has said repeatedly that he would not begin discussions with Israel before there was a total halt to construction beyond the June 4, 1967 lines.

Netanyahu, who has already declared a 10-month housing-start moratorium in the West Bank settlements, has said he will not agree to any limitations on construction in east Jerusalem.

"This is not going to happen; it goes against everything Netanyahu says and believes in," one source in the Prime Minister's Office said about even a symbolic freeze in Jerusalem.

The source also dismissed as completely unrealistic the idea that Netanyahu could agree to an unofficial halt to Jewish construction in east Jerusalem, meaning that although he would not announce anything publicly, new building in the capital beyond the pre-Six Day War lines would stop for a certain amount of time.

In addition to being against Netanyahu's world view, the official said, an unofficial freeze would also be unsustainable, since the news of any such informal agreement would inevitably be leaked and cause Netanyahu severe political damage.

The US has been urging the PA to return to negotiations since the cabinet approved the housing-start moratorium on November 25, and has also been trying to get the Arab world, specifically Egypt and Saudi Arabia, to encourage Abbas to return to the table.

In exchange for the PA returning to the negotiating table, it is widely assumed that Israel would be asked to take some additional steps. Among the ideas that have been raised are expanding Area A in the West Bank, where the Palestinians have both civil and security control; removing more roadblocks; releasing Palestinian security prisoners to Abbas; opening the border crossings into the Gaza Strip to allow for a greater flow of goods and materials; and reopening Orient House in east Jerusalem.

On Sunday, however, Foreign Minister Avigdor Lieberman seemed to dash any notion of more gestures to the Palestinians to lure them to talks, saying Israel had emptied out its "arsenal of gestures" and that Jerusalem was now waiting for gestures from the Palestinians.

After months of praising the work of the Palestinian security forces in the West Bank, Prime Minister Binyamin Netanyahu told a delegation of US senators on Sunday that while active against Hamas and Islamic Jihad, the PA security forces "have trouble going against their own renegades."

Netanyahu was referring to the recent murder near Shavei Shomron of Rabbi Meir Avshalom Hai by members of Fatah's Aksa Martyrs Brigade.

"They are showing timidity about addressing their own renegades," he told Senators John McCain (R-Arizona), Joe Lieberman (Independent-Connecticut), John Barrasso (R-Wyoming) and John Thune (R-South Dakota).

The four senators were here for the day as part of a regional tour that took them as well to Iraq, Afghanistan and Pakistan.

Government sources said the threat of the US using economic leverage - such as withholding loan guarantees - to place pressure on Israel was not raised in the one-hour conversation. US Middle East envoy George Mitchell, when asked last Wednesday in a television interview what "sticks" the US had in its arsenal against Israel, raised the notion of withholding loan guarantees, although he quickly said this was not the direction the US wanted to go in.

Lieberman, after saying that an administration official had already disavowed Mitchell's statement, said that in his opinion "any attempt to pressure Israel, to force Israel to the negotiating table by denying Israel support, will not pass the Congress of the United States. In fact, the Congress will stop any attempt to do that. I don't think we will come to that point."

McCain was equally unequivocal, saying that this type of pressure would not be helpful "and I don't agree with it."

McCain added that he was sure that the administration would make it clear in the future that this was not its policy.

Senior officials in the Prime Minister's Office said they had received no signals whatsoever that the US administration was considering such a move. This did not prevent some cabinet ministers, such as Finance Minister Yuval Steinitz and Education Minister Gideon Sa'ar, from addressing the issue before the weekly cabinet meeting.

"We don't need to use those guarantees, we get along fine without them," Steinitz said. He said that the US and Israel just recently reached a new agreement on the guarantees, and there was no condition whatsoever placed on them. "Israel did and is doing everything, including making gestures that are not easy, to re-start the negotiations [with the Palestinians]," he said. "I have no indication that they are going to pressure us with the guarantees."

Sa'ar said that it needed to be clear that Israel would act according to its interests, and "not as a function of its relations with other countries."

During his meeting with the senators, Netanyahu expressed frustration with the continued Palestinian rejection of negotiations, and said the Palestinian Authority was trying to "internationalize the conflict" in the hope that the European Union and UN Security Council would pressure Israel.

"In certain quarters in the international community," Sa'ar said, "Israel is seen as being guilty even before it has been proven guilty." He said that the international community must "stop coddling" the Palestinians and send a message that it expected them to return to the negotiations.

Netanyahu also said he was "not going to run away" from the core issues in the negotiations, but that in his mind "the ultimate core issue is the acceptance of Israel as the nation state of the Jewish people. It is not about settlements; it is about the existence of a Jewish state."

The prime minister's message seemed to register with the senators, because at the press conference both McCain and Lieberman called for an immediate resumption of talks, and for Israel to be recognized as a Jewish state.

"I have come to the conclusion that the prime minister of the State of Israel is right, it is time to sit down without preconditions and begin serious negotiations to bring about a lasting and permanent peace," McCain said. He added that he didn't think "it is much to ask to recognize the right of a country to exist as part of a way to reach an agreement with one's neighbors."

Before the meeting Netanyahu told the cabinet he regarded "very seriously the recent spate of mortar and rocket fire at Israel" from the Gaza strip, and stressed that "any firing at our territory will be responded to strongly and immediately."

Reiterating a theme that the Prime Minister's Office brought up with Washington last week, Netanyahu said that the problem was not only rockets, but an increase in incitement from the PA and its leaders.

Basing himself on information provided by the Palestinian Media Watch, Netanyahu said that "incitement continues in the Palestinian media and education system; in its official media outlets and in the schools under its supervision. These serious actions represent a harsh violation of the Palestinians' international obligation to prevent incitement. I say to the chairman of the Palestinian Authority [Mahmoud Abbas]: Stop the incitement. This is not how peace is made."