Telecoms clamp keeps Palestinians on hold
The major Israeli checkpoints in the West Bank are easily recognisable by their grey army pillboxes. But the Israeli barrier to the development of a telecommunications industry in the Palestinian Authority's territory is less visible.
Last week, at the partially inhabited headquarters of the Wataniya Palestine Mobile Telecommunication Company, public relations manager Maxim Sansour's voice echoed through the empty office of a planned call centre.
'This place is supposed to be buzzing with employees,' Mr Sansour said. 'We've formed a team of 75 employees and we've also been scanning Palestinian cities to locate where we will put our towers. The one obstacle stopping us is that we need the frequencies in order to start.' The frequencies are in Israel's hands.
Despite repeated visits by US Secretary of State Condoleezza Rice, who made her latest Arab-Israeli foray last week, progress in peace talks between Israeli Prime Minister Ehud Olmert and Palestinian president Mahmoud Abbas remains slow. Meanwhile, the 41-year-old Israeli occupation continues to dictate most aspects of Palestinians' lives, including their phone bills.
There was widespread anticipation in the West Bank of the launch of Wataniya. But according to self-rule agreements reached during the 1990s, control of frequencies was left to Israel and their disbursement was made subject to negotiation. For more than a year, Wataniya has been on hold as Israel delays the transfer of frequencies, citing reasons that many Palestinians find unconvincing.
'There are intensive deliberations dealing with the width of the frequencies, the date they will be relinquished and the time frame,' said Yechiel Shavi, a spokesman for Israel's Ministry of Communications. 'Each side is holding to its position. The ministry intends to finish the negotiations at the earliest possible time.'
The cost of the delay is high, not only to Qatari-owned Wataniya but to the Palestinian economy as a whole as it prolongs the monopoly of the 11-year-old Palestine Telecommunications Company (PalTel). PalTel's subsidiary, Jawwal, controls 65 to 80 per cent of the mobile phone market in the West Bank and Gaza, with unauthorised Israeli operators taking the rest, according to the World Bank.
'Increasing competition and efficiency in the [telecoms] sector will have far-reaching effects throughout the Palestinian economy,' said a World Bank report on Palestinian telecommunications issued in February. 'It will reduce the cost of doing business in all sectors and help raise government tax revenues.'
As Palestinians prepare to host a major investment conference in Bethlehem next month, with assistance from the international community's Middle East envoy, Tony Blair, Israeli movement and access restrictions, low Palestinian private investment and lingering monopolies remain among the ills plaguing the West Bank's economy.
The situation in Gaza is much worse, with an Israeli blockade in response to Hamas control and rocket attacks decimating the private sector and making most of the population dependent on humanitarian aid. Unemployment in the West Bank and Gaza Strip is 23 per cent, almost double the rate at the start of the Palestinian uprising in 2000.
'This conference won't make a difference if mobility does not improve,' said Hisham Awartani, director of the Centre for Private Sector Development in Nablus.
'A merchant who sends tomatoes and grapes from one town to another within the West Bank pays five times what he should in transport costs because the truck owner waits for hours and hours at the checkpoint. This is not security, this is torture.'
Israeli Defence Ministry spokesman Shlomo Dror said Israel wanted to encourage economic growth in the West Bank and was making it easier for businessmen to travel before the conference.
He said lifting the roadblocks could touch off a wave of terrorist attacks that would destabilise the West Bank economy even more than the restrictions did. 'Then the response will be a complete closure and we won't be able to allow the 50,000 workers who come to Israel to come any more,' he said.
Palestinian Authority Planning Minister Samir Abdallah said most checkpoints served no security purpose and existed for the same reason as Israel's refusal to hand over frequencies: to keep the Palestinian economy and government weak.
Mr Olmert is under pressure from his ultra-orthodox Shas party coalition partner not to compromise with the Palestinians, and this week announced its intention to build 750 more apartments for settlers in East Jerusalem and the West Bank.
Mr Abdallah said if Wataniya were able to start operations, 'we would have competition, the efficiency of the existing operation would be improved, service and quality would be improved and cost to the consumer would be less by 20 to 30 per cent'.
Israeli mobile phone companies with unauthorised operations in the West Bank based on prepaid phone cards would, however, lose customers and profit.
The World Bank, in its report, criticised PalTel for what it said was anti-competitive behaviour but stressed that the single most important development would be if Israel freed up the frequencies so Wataniya could begin functioning.
PalTel officials declined to be interviewed, but the Palestinian newspaper al-Quds reported that its chief executive, Abdul-Malik Jabbar, said PalTel welcomed competition and would also benefit if the frequencies were released as it also wants more frequency spectrum.