From Payer to Player in the Middle East

The European Union has contributed billions of euros in aid to the Palsestinians, but has little to show for it in terms of enhancing peace, stability, and its own influence. Where Europe can really make a difference is in framing a Balkan-style stability pact that addresses people’s existential concerns: land ownership, water rights, and demography.

The European Union’s policy in the Middle East is the litmus test of its common foreign and security policy. Many Europeans share this belief, but, as the EU considers entering the fray of Middle East peace talks, it must respond to former Israeli Prime Minister Ariel Sharon’s jibe that in the region “you are payers, not players.”

Yet Europe’s potential contribution should not be underestimated. Europe’s financial contribution to the Middle East has been consistent and impressive. Between 1995 and 1999, it spent roughly €3.4 billion in the region, to which the European Investment Bank added a further €4.8 billion in loans. From 2000 to 2006, Europe spent another €5.35 billion, and the EIB approved €6.4 billion in loans. This year, the European Commission has committed €320 million in Palestine alone.

So much for the role of payer. But has Europe’s financial aid brought peace any closer? The Palestinian Authority has received more aid per capita than did post-war Europe under the Marshall Plan, yet the politics of the Israeli-Palestinian conflict have foiled hopes of a broader Euro-Mediterranean framework that, through dialogue and investment, would bring tangible improvements to the lives of millions.