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.”

Washington will announce the renewal of talks between Israel and the Palestinian Authority through a trilateral summit of U.S. President Barack Obama, Prime Minister Benjamin Netanyahu and Palestinian President Mahmoud Abbas.

The meeting would take place on the sidelines of the UN General Assembly late this month; two years would be allotted to completing talks on a peace agreement.

On Monday President Shimon Peres confirmed that such a summit was being considered, under facilitation by Obama.

Peres also all sides to broaden the scope of peace talks beyond the contentious issue of settlements, though he called it a matter that would need to be addressed.

"On that particular issue, there is not yet an agreement. Negotiations are going on. I do believe there is a solution for it as well," Peres said. "It's very hard to convince your own people to make so many concessions, to take so many risks."

"But this is the task of a leader to move ahead," he said, adding Netanyahu was aware of what needed to be done. "He knows there is no chance, no escape, no alternative to go ahead and make peace. He knows he must do it ... it's just not a simple proposition," Peres said.

U.S. officials briefed representatives of several European Union countries last week on the diplomatic vision Obama will present at the UN.

Last week, after meeting Netanyahu in London, special U.S. envoy George Mitchell briefed several European Union foreign ministers on the latest developments in Middle East peace talks. Meanwhile, senior White House officials updated several European ambassadors on their plan for advancing the negotiations.

Israeli envoys Yitzhak Molcho and Brig. Gen. Mike Herzog flew to Washington on Monday for talks with Mitchell.

European and Israeli diplomats told Haaretz that Mitchell and other top Washington officials said "Obama has no new peace plan," but only that the diplomatic outline is different from the so-called Annapolis process and is based on several guiding principles.

First is that talks will advance according to the Middle East road map. Second, the target for completing negotiations will be two years from now. Third, unlike the Annapolis process, the United States will take a more active role in the talks and will "take a seat at the negotiating table."

The U.S. officials told the Europeans that in the coming weeks, possibly before the General Assembly opens, Washington could declare an agreement for "confidence-building measures" drafted by Israel and the Palestinians to allow talks to progress.

"We didn't reach 100 percent of what we wanted in Israel and the Arab states, but we got enough to allow for the renewal of talks," a U.S. official said.

The agreement would call for Israel to temporarily or partially freeze settlement building, though the length of the freeze was not stipulated. "In the next meeting with the Israeli negotiating team the issue will be settled conclusively," a U.S. official said. Their counterparts in Jerusalem said the freeze could last at least six to nine months. One Israeli source said the freeze could last up to a year.

Meanwhile, the American officials said they had achieved a series of normalization steps by Arab states toward Israel, though Saudi Arabia had declined to commit to any goodwill gestures toward Israel. Instead, it is transferring several hundred million dollars to the authorities in Ramallah.

One European diplomat said Qatar would reopen the Israeli diplomatic mission in Doha, and several other states will allow direct flights from Israel through their airspace and to their airports. Several Persian Gulf states also agreed to grant tourist visas to Israeli tourists and businesspeople.

The American officials said that after talks are renewed, they would be interested in convening an international peace summit before the end of this year. European and Israeli diplomats said Moscow is a leading possibility to host the meeting, and that members of the Quartet of Mideast peace negotiators had already promised Russia to hold it in that nation's capital.

Another candidate to host the meeting is Paris. French President Nicolas Sarkozy and his Egyptian counterpart Hosni Mubarak recommended to Obama that the summit be held in the city in the framework of the Union for the Mediterranean, of which France and Egypt are co-presidents. Sarkozy also floated the idea separately with Netanyahu and Abbas.

American officials told the Europeans they are also interested in restarting the Israeli-Syrian and Israeli-Lebanese diplomatic tracks, though those processes would take several months to launch. Restarting those tracks, they said, would also improve U.S.-Syrian and Syrian-Lebanese relations.

Monday Abbas said he would agree to renew the peace process with Israel only if it agreed to a freeze on settlement construction.

EU foreign policy chief Javier Solana told Haaretz after meeting Israeli representatives Monday that no agreement had been reached on freezing settlement growth in the West Bank and East Jerusalem.

Solana said Mitchell would return to the area next week in hopes of returning Israel and the Palestinians to the negotiating table.

Foreign Minister Avigdor Lieberman told Solana Monday, "We must not commit to target dates on a comprehensive agreement, since in the past this has brought disappointment and frustration, and led to conflicts between the two sides.

"The Palestinians' unilateral initiatives do not contribute to creating a positive dialogue between the two sides. If the Salam Fayyad initiative goes through, it won't go unanswered," Lieberman said. Last week the PA prime minister announced a plan for creating a "de facto Palestinian state" within two years if the peace process continues to stagnate.

The United States views East Jerusalem as no different than an illegal West Bank outpost with regard to its demand for a freeze on settlement construction, American sources have informed both Israel and the Palestinian Authority.

This clarification came in the context of a growing crisis in U.S.-Israel relations over the planned construction of some 20 apartments for Jews in the Shepherd Hotel, in East Jerusalem's Sheikh Jarrah neighborhood. The U.S. has demanded that the project be halted, but Prime Minister Benjamin Netanyahu told the cabinet meeting Sunday that "Israel will not agree to edicts of this kind in East Jerusalem."

"United Jerusalem is the capital of the Jewish people in the State of Israel, and our sovereignty over the city is not subject to appeal," he continued. "Our policy is that Jerusalem residents can purchase apartments anywhere in the city. This has been the policy of all Israeli governments. There is no ban on Arabs buying apartments in the west of the city, and there is no ban on Jews building or buying in the city's east. This is the policy of an open city."

Saying that Israel could not accept Jews being forbidden to live in anywhere in Jerusalem, Netanyahu added: "I can imagine what would happen if someone proposed that Jews could not live or buy in certain neighborhoods of London, New York, Paris or Rome. A huge international outcry would surely ensue. It is even more impossible to agree to such an edict in East Jerusalem."

Asked to comment on these remarks, U.S. Secretary of State Hillary Clinton, who was in New Delhi, said the administration is trying to reach an agreement with Israel on settlements, and "the negotiations are intense," the Associated Press reported.

Later Sunday, Netanyahu met with his advisors to discuss Israel's response to Washington's demand.

"I was surprised by the American demand," a source present at the meeting quoted him as saying. "In my conversation with [U.S. President Barack] Obama in Washington, I told him I could not accept any restrictions on our sovereignty in Jerusalem. I told him Jerusalem is not a settlement, and there is nothing to discuss about a freeze there."

"In my previous term [as premier], I built thousands of apartments in the Har Homa neighborhood of Jerusalem, defying the entire world," Netanyahu added. "Therefore, it is clear that I will not capitulate in this case - especially when we are talking about a mere 20 apartments."

Other ministers also criticized the American stance at the cabinet meeting. Foreign Minister Avigdor Lieberman, for instance, termed it "puzzling," while Interior Minister and Shas Chairman Eli Yishai declared that "no agency in the world can stop construction in Jerusalem."

And Shin Bet security service chief Yuval Diskin told the ministers that the PA and its security services are engaged in widespread efforts to keep Palestinians from selling land in Jerusalem to Jews. He also said that Sheikh Yusuf Qaradawi of Qatar has allocated $21 million to Hamas activists to buy buildings and establish infrastructure in Jerusalem.

Washington's objections to the Shepherd Hotel project were first voiced by senior State Department officials at a meeting with Israeli Ambassador Michael Oren last Thursday, in response to a request by PA President Mahmoud Abbas. The officials complained that the construction would change the neighborhood's demographic balance and harm its Palestinian residents.

Oren responded that the land in question was privately owned, having been purchased in 1985 by American Jewish tycoon Irving Moskowitz, and the project has received all the necessary permits from the Jerusalem municipality.

Also Sunday, Abbas' bureau chief, Rafiq Husseini, said he hoped the U.S. would not back down on its demand for a complete settlement freeze, including in East Jerusalem.

In an interview with the Nazareth-based radio station A-Shams, Husseini said, "from our standpoint, there is no room for a compromise [on this issue], and we expect the American administration to stick to the determined stance that envoy [George] Mitchell expressed as far back as 2001. Any compromise that enables continued construction ... will do nothing whatsoever to advance the diplomatic process."