Shelf Agreement: Attempts to Anchor the Two State Solution may Bury it

Both the success and failure of negotiations present difficult consequences. Israel should therefore create a safety net by systematically transferring powers and authorities to the Palestinian Authority while simultaneously re-assessing the agenda of the political process.

Essence of Warning

In this document, the Reut Institute contends that a Shelf Agreement may actually accelerate the collapse of the Two State Solution. This is because the negotiations - even if concluded in an agreement - will bring Israel and the Palestinians to a moment of truth towards the Two State Solution when it seems that the time is not ripe.

The current political process is based on a series of questionable assumptions including the idea that it is easier to achieve a Shelf Agreement than a 'real' agreement for implementation, that it is preferable for Israel to reach a comprehensive agreement rather than an interim one and that a signed agreement between Israel and the Palestinians has great importance even without significant changes on the ground.

This document complements other work by the Reut Institute that has dealt with Israel's security dilemmas and the consequences of a possible failure of negotiations. The conclusion drawn from all these documents is that Israel is stuck between a rock and a hard place. Whether negotiations succeed or fail, Israel will face difficult consequences such as a Hamas take-over of the West Bank or the collapse of the Palestinian Authority (PA) and the renewal of full Israeli responsibility over the West Bank.

Therefore Israel should create a safety net by systematically transferring powers and authorities to the PA while simultaneously re-assessing the agenda of the political process.

Policy Options

Avoid a "moment of truth" - In light of the trap between the consequences of failure of negotiations and the latent danger in achieving an agreement, Israel should consider refraining (as much as possible) from reaching a 'moment of truth', such as an "Annapolis B Summit" that could be defined as a "success" or "failure". Moreover, the fewer declarations there are regarding the nature of the process or agreement (timetables, contents or finality of claims), the greater the negotiators' room to maneuver.

Create a safety net in case negotiations fail - Although the Government of Israel is aware of the potential dangers of the possible failure of the political process, 1 it has yet to formulate a strategy to deal with failure. A possible strategy might include:

a. An agreed 'Plan B' for the political process - Israel should aim to get the agreement of the US, the Quartet and the PLO (to the extent possible) to fix an agreed mechanism to change the agenda of the political process in case negotiations or the ratification process fails. As an example, the sides might agree that the failure of negotiations will lead to negotiations over the establishment of a Palestinian state with provisional borders in conjunction with the second phase of the Roadmap.

b. Strengthening and upgrading the PA may prevent its collapse if the political process fails. In previous documents, the Reut Institute contended that the keys to upgrading the PA lie in the hands of Israel as only Israel can upgrade the PA's status by the systematic transfer of powers and authorities.

c. Strategy to 'freeze' the process - Israel may prefer to freeze negotiations until after elections in Israel, the PA or the US. Israel should coordinate these steps with the US in order not to create the impression that negotiations have failed.

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