Louis Perlmutter: Architect Of Peace
-
ground and then issued an
unexpected request: Would
the CFR put together a group
that would work with him
in dealing with the flow of
development aid and pledge
money to the Palestinian Au-
thority?
It was a signal to all involved
that were such a group to be
formed, it would have his trust
and authority in the region.
"Arafat's relations with the
donor community up to that
point had gone poorly," says
Mr. Perlmutter. "There was a
lot of criticism from his side
that the World Bank was too
bureaucratic, from their side
that there were no Palestinian
governing structures in place
that could actually make use
of the $2.1 billion that had
been pledged; money would
come in, and there'd be no ac-
counting for how it was used,
so donor countries were reluc-
tant to continue. Everything
was stagnating."
So Mr. Perlmutter and Mr.
Seigman sat down and created
the Council of Economic Advi-
sors.
"I picked these eight people
— Robert Lifton, president of
Medis El Ltd.; Hani Masri,
president of the Capitol Corp.;
Ted Sorensen, partner at Paul,
Weiss, Rifkind, Wharton and
Garrison, among them — be-
cause they've each had a
specific role to play in institu-
tion building and nation-build-
ing," says Mr. Perlmutter.
"What I'm basically trying to
do is apply the skills, knowl-
edge and relationships I've
gained in over 35 years as an
investment banker and make
a contribution in the public
sphere. Solve some problems
in a non-governmental set-
ting."
"Louis keeps us honest,"
says Mr. Seigman. "There's
a tendency to get distracted
by politics and ideology, and
Louis takes a very hard-nosed,
practical approach to our role.
For example, in our early
discussions with the Palestin-
ian National Authority, we
were talking nation-building
on a grand scale, but he in-
sisted we take on only one pro-
ject, and see that through to
fruition.
"So we chose the Gaza
coastal road — which•is a pro-
jected highway that will make
the coastline of that area into
a major tourist attraction —
and though no one took us se-
riously at the beginning, less
than a year later (and after nu-
merous feasibility studies) we
got the World Bank to include
the road on a list of priority
projects submitted to the donor
countries last year. Louis con-
tinually insists that we define
exactly what we can bring to a
problem that a government
cannot."
It's Up To Arafat
The specific problem facing
Mr. Perlmutter and his group
at the moment is still the
progress in Gaza — or lack of
it.
"Until we see some real eco-
nomic development and im-
provement on the ground," Mr.
Perlmutter says, "there's going
to continue to be unrest and
unhappiness. The annual in-
come of people in Gaza is $800;
just across the border, the
mean is approaching $15,000.
That's such a disparity that
even with the best of will in the
world — and of course there is
not the best of will in the world
— I don't think we will make
a lot of progress."
The recent suicide bombings
in Tel Aviv and Jerusalem, of
course, only add to the pres-
sure.
"At this point," Mr. Perl-
mutter says, "the only person
who can save the peace process
is Arafat. He has to prove to
the Israeli people that he is a
real partner by mobilizing all
of his resources in order to de-
stroy the Hamas network. He
cannot play it the way he usu-
ally does — telling the Pales-
tinians one thing and the
Israelis another — but must
truly stand up and be counted."
Overall, Mr. Perlmutter, not
surprisingly, is looking at the
economic view: Create jobs,
boost the treasury, and you
will engender a situation in
which peace, and democracy,
are possible. The question
is, how do you create jobs in
a land which is, essentially,
starting from scratch? There
is simply no infrastructure
in Gaza. The answer, at least
according to the World Bank
and its engineering experts:
the industrial parks that have
become Mr. Perlmutter's do-
main.
The projected parks would
include areas of 20 to 30 acres
that would house several basic
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manufacturing plants (textiles,
light assembly), in all likeli-
hood owned by Israelis or oth-
er Middle Easterners. They
would benefit from free trade
packages, tax concessions, ex-
port licenses and an enormous,
and available, workforce of un-
employed Palestinians (the job-
less rate in Gaza is close to 60
percent).
The World Bank envisions
12 or 14 of these parks sprin-
kled along the borders between
Israel and the West Bank/
Gaza, and, as is its wont, had
created many theoretical pa-
pers describing its vision — but
no real models.
'There had been a lot of talk
about the parks, but no
progress," says Mr. Perlmut-
ter, "so we decided to make this
our special project, and focus
on what we really needed to do
to get one up and running.
"We said: Forget doing them
all at once, let's just do one
as a prototype and figure
out who is actually in charge
of the project in either country,
what laws need to be passed
in Israel and by the Authori-
ty to make it work, what kind
of roads need to be created,
what kind of transportation
made available — the real
nitty-gritty practical matters
— and then actually get it
done."
At this point, potential in-
dustrialists have been con-
tacted, a site selected, the
people in control pinpointed,
and studies done by techno-
logical experts on the various
infrastructure questions.
And still Mr. Perlmutter is
worried.
"The situation is — I don't
want to use the word 'crisis' —
it is very urgent. It's essential
that these projects get up
and running, and that they
work. We have a rather ambi-
tious timetable," says Mr.
Perlmutter.
And then?
"And then I think peace in
the Middle East is possible.
(Syrian President Hafez al-)
Assad, obviously, is the ulti-
mate key to it all — he wants
to be the kingmaker, the
one remembered in the histo-
ry books as the one who
brought true stability to the re-
gion — and who knows how he
will stage-manage that? But
we'll have our part done by the
end of 1997. And then we will
see."
❑
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