Netanyahu has called the Oslo Accords a 'mistake'. AP
Netanyahu has called the Oslo Accords a 'mistake'. AP
Netanyahu has called the Oslo Accords a 'mistake'. AP
Netanyahu has called the Oslo Accords a 'mistake'. AP


Netanyahu's rejection of Oslo brings a greater need to restrain Israel


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December 17, 2023

One achievement US President Joe Biden’s administration can claim in its relations with Israel is that it appears to have thwarted an Israeli plan to attack Lebanon after Israel vowed to flatten Lebanon into a wasteland, similar to Gaza. The Biden team has insisted that, at this stage at least, there is no need to entwine Hezbollah, the militant political party in Lebanon, with Hamas in Gaza, even though Israel claims both pose a threat to its existence.

Israeli Prime Minister Benjamin Netanyahu and his war cabinet have reluctantly refrained from any move to launch a war on Lebanon (beyond strikes in the border area) on the condition Hezbollah’s provocations can be restrained. But any such agreements are going to be conditional and temporary. Indeed, there are profound differences between the US and Israeli visions for the “day after” and permanent solutions, and there are no signs of a breakthrough on the near horizon.

Mr Netanyahu, with considerable popular support despite deep divisions over issues like how to rescue Israeli hostages in Gaza, has finally revealed his government’s intentions. Last week, in several unequivocal statements, he clarified his opposition to the Oslo Accords of the 1990s, which promised Palestinians their own state. He called them a “mistake” that should not be repeated.

Israel has never been genuinely committed to the Oslo Accord's promise of establishing a Palestinian state. It has consistently sidestepped the two-state solution while pocketing the security commitments implemented by the Palestinian Authority. And it has always asserted that Jordan should serve as an alternative homeland for Palestinians, dismissing Jordan's sovereignty and contrary to US and international positions.

When Yitzhak Rabin came to power as Israel’s prime minister for a second time in 1992, he did so as a leader who perceived the creation of a Palestinian state alongside Israel to be in Israel's interest. He was an advocate of peace, co-existence and the two-state solution, and he was assassinated for it by Israeli extremists three years into his term.

Since then, Israel has continued to circumvent the two-state solution without rejecting it publicly or explicitly, until Mr Netanyahu’s remarks last week.

The common ground between Mr Netanyahu and his extremist coalition on one side, and Hamas on the other, is their rejection, both historical and ongoing, of the two-state solution. At a fundamental level, there has always been – consciously or not – a partnership between them. Israel played a role in the creation of Hamas, aiding its funding for years to sustain its fight against the Palestinian Authority led by Mahmoud Abbas — an advocate of Oslo, the two-state solution and the establishment of a Palestinian state alongside Israel.

The common ground between Netanyahu and Hamas is their rejection, both historical and ongoing, of the two-state solution

Today, however, given Hamas's predicament in the aftermath of its attack on October 7 and Israel's retaliation against Gaza, the group’s political leadership may want to portray itself as ready to make radical changes. This could explain the recent discussions or verbal slips about accepting the two-state solution and a willingness to join the PLO. Hamas's messages to Israel, the US, and the world right now seem to convey a readiness to reinvent itself, opting for some measure of moderation, though the real motives are not yet clear.

It is likely Hamas wants to rebuild itself with the aim of gaining control over the West Bank, not just Gaza. Its leaders want to develop a strategic plan to reconstruct the organisation, positioning it to assume leadership and act as an alternative to the PLO. While Hamas currently speaks the language of engagement and partnership with the PLO, its true intent is more likely to replace the organisation, especially as it believes it has more support than the Palestinian Authority does from ordinary Palestinians.

This is concerning, given the suspicious relationship between Israel and Hamas. Historically, Hamas's actions have often provided Israel with pretexts to impose an extreme agenda. The ongoing displacement of Gazan Palestinians in the aftermath of October 7 aligns with a longstanding right-wing Israeli conviction that Sinai is a viable alternative to Gaza.

In the same vein, should Hamas succeed in gaining control of the West Bank, it would inevitably provide Israel with a pretext to force the displacement of Palestinians there to Jordan, the "alternative homeland".

But it is not right to say Hamas is the sole cause; the primary catalyst is Israel's extremist policies, the audacity of Israeli settlers and a brazen government solely focused on retaining power at any cost to Israel, and not just at the expense of Palestinian civilians.

Mr Netanyahu has justified, with astonishing audacity, his actions against Gazans by comparing them to what the US has done in its own wars. It is true that American wars were never “clean”. After the 9/11 terrorist attacks on New York and Washington, then president George W Bush engaged in the failed war in Afghanistan and hastily invaded and occupied Iraq as retribution for the attacks and those who supported them. But Mr Netanyahu has ignored Mr Biden’s own allusions that many of America’s actions in those wars were mistakes.

Today, we find ourselves on the brink of a regional or even global war if Israel is allowed to expand the conflict further. The success of Mr Biden's team in preventing Israel from executing any plan to strike Lebanon means putting a spoke in the wheel of a regional war that risks drawing in Hezbollah’s patron, Iran. Deterring Israel means deterring Iran, and vice versa.

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Retirement funds heavily invested in equities at a risky time

Pension funds in growing economies in Asia, Latin America and the Middle East have a sharply higher percentage of assets parked in stocks, just at a time when trade tensions threaten to derail markets.

Retirement money managers in 14 geographies now allocate 40 per cent of their assets to equities, an 8 percentage-point climb over the past five years, according to a Mercer survey released last week that canvassed government, corporate and mandatory pension funds with almost $5 trillion in assets under management. That compares with about 25 per cent for pension funds in Europe.

The escalating trade spat between the US and China has heightened fears that stocks are ripe for a downturn. With tensions mounting and outcomes driven more by politics than economics, the S&P 500 Index will be on course for a “full-scale bear market” without Federal Reserve interest-rate cuts, Citigroup’s global macro strategy team said earlier this week.

The increased allocation to equities by growth-market pension funds has come at the expense of fixed-income investments, which declined 11 percentage points over the five years, according to the survey.

Hong Kong funds have the highest exposure to equities at 66 per cent, although that’s been relatively stable over the period. Japan’s equity allocation jumped 13 percentage points while South Korea’s increased 8 percentage points.

The money managers are also directing a higher portion of their funds to assets outside of their home countries. On average, foreign stocks now account for 49 per cent of respondents’ equity investments, 4 percentage points higher than five years ago, while foreign fixed-income exposure climbed 7 percentage points to 23 per cent. Funds in Japan, South Korea, Malaysia and Taiwan are among those seeking greater diversification in stocks and fixed income.

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  • Bahia Bakari, then 12, survived when a Yemenia Airways flight crashed near the Comoros in 2009, killing 152. She was found clinging to wreckage after floating in the ocean for 13 hours.
  • Jim Polehinke was the co-pilot and sole survivor of a 2006 Comair flight that crashed in Lexington, Kentucky, killing 49.
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Updated: December 18, 2023, 4:25 AM`