At the moment, the collapse of direct negotiations between Palestinian Authority Chairman Mahmoud Abbas (Abu Mazen) and Israeli Prime Minister Benjamin Netanyahu seems highly possible. Questions have been raised regarding Netanyahu's ability to both renew the settlement freeze and preserve his right-wing coalition simultaneously. On the Palestinian side it is unclear what Abu Mazen will do in case the talks collapse. He has threatened, not the first time, to step down as chairman of the Palestinian Authority if there is no progress in the negotiations.
Yet the majority of the public, as well as the media in Israel, the US and Europe neglect a very substantial variable in the future of Israeli-Palestinian relations - Palestinian Prime Minister Salam Fayyad. Fayyad, who worked for the World Bank and International Monetary Fund, and received his Ph.D. in economics from the University of Texas at Austin, has been working insistently in his three years as Prime Minister and especially in the past year, toward his stated goal of building a viable independent Palestinian State in the West Bank and Gaza.
Salam Fayyad (Arabic: Ø³ÙØ§.. ÙÙØ§Ø¶ ";) image from wikipedia
In August 2009 Fayyad published a detailed plan for building a de facto state under Israeli occupation and eventually declaring independence unilaterally by August 2011. The plan, titled: "Palestine - Ending the Occupation, Establishing the State", deals with every issue of sustainable statehood, from physical infrastructure to financial independence to proper health and education. Starting with a controversial crackdown on corruption in the Palestinian public sector and inside the ruling Fatah party , and moving on to a no less controversial ban on products from Israeli settlements, Fayyad has stood to his word and pushed the Palestinian economy forward with a 6% rise in GDP in 2009 (compared to 1% in Israel the same year) and an expected 8% rise in 2010.
Under Fayyad the streets of Nablus and Jenin have become safer and a new Palestinian city - the first planned Palestinian city in history Rawabi is being built in the hills overlooking Ramallah, with the blessing of the international system and investments from Persian Gulf princes. At the same time there is also work being done on Establishment of a central bank and independent judiciary system, and development of the Ramallah Stock Exchange.
In July this year the IMF published a report on the progress of the Palestinian economy, which concluded that the PA was already economically viable as a state. A month later, as Netanyahu and Abbas were meeting under the mediation of US Secretary of State, Hillary Clinton, Fayyad was in Washington presenting a mid-term report on his state-building project, meaningfully titled: "Homestretch to Freedom".
An intriguing entry in the report deals with the PA's investment in neighborhoods in East Jerusalem, which is under Israeli jurisdiction and not part of the PA. In his homestretch to statehood, Fayyad has not left any stone unturned, including Palestinian neighborhoods in areas that Israel is unwilling to concede to the new state.
So, while the talks may continue or they may stall, Mr. Fayyad, which Israeli President, Shimon Peres has called "the Palestinian Ben Gurion", connoting Israel's founding father and first prime-minister who was known as a man of action, is quietly but insistently building the option of a unilateral declaration of independence, regardless of the outcome of negotiations.
A unilateral Palestinian declaration of independence would create a very complex reality for Israel. If the young state receives broad international recognition, as Fayyad is quietly working to ensure, then Israeli settlers and Israeli military, located in the West Bank, could wake up one day to find themselves effectively not in Israel but within the Palestinian State, their presence there becoming highly illegal. This will likely result in a more determined international demand, that Israel withdraw from the Palestinian territories, and it will also put an end to Israel's aspiration of maintaining parts of the West Bank under Israeli control.
Fayyad's plan talks about a Palestinian state that includes not only the West Bank but also the Gaza Strip which is now under the control of Islamic militants Hamas. Fayyad has not provided a clear explanation of how the reunification of Gaza with the West Bank is meant to happen, but parallel to social and economic nation building, the Fayyad government is also working to strengthen the Palestinian security forces, with the help of US army training. Perhaps, Fayyad is also preparing for internal conflict if necessary.
Thus, it seems the Palestinians can do without the negotiations. If Israel chooses to freeze talks instead of freezing the settlements, it could very well find itself within a few months, facing a self-declared Palestinian state in the 1967 borders. It is therefore in the Israeli government and people's interest to make an effort to continue the peace talks and lead them to an agreement on the borders of both states. This may be Israel's last chance to reach a negotiated settlement to the century old conflict.