'Major economic growth' possible in Palestine, says IMF chief at controversial summit

IMF chief Christine Lagarde said major economic growth was possible in the Palestinian territories if all sides showed urgency, in comments made during a controversial economics-focused “peace conference” in Bahrain that has been rejected by Palestinians.

"If there is an economic plan, if there is urgency, it's a question of making sure that the momentum is sustained," said Lagarde.

The International Monetary Fund, which has long warned of severe deterioration in the Palestinian economy, is attending a conference in Bahrain to discuss the economic aspects of a United States plan for Israeli-Palestinian peace.

The conference, which unveils plans presented by White House advisor Jared Kushner calls for $50 billion of investment in the Palestinian territories and its neighbours within a decade, has already been rejected by Palestinians as it fails to address key political issues, such as Israeli occupation of the West Bank and the right of Palestinians to self-determination and statehood.

In an interview with Al Jazeera on Wednesday, Kushner said the US no longer supported plans for Palestinian statehood, and that any deal would be “somewhere between the Arab Peace Initiative and the Israeli position”.

Read more: Who is attending US-led Bahrain summit on Israeli-Palestinian conflict?

The 2002 Arab Peace Initiative offered Israel complete normalisation of relations in return for withdrawal from the West Bank and Gaza Strip and establishment of a Palestinian state there.

Israeli Prime Minister Binyamin Netanyahu rejects the idea of a Palestinian state and the US has indicated support for Israeli plans to annex settlements in the West Bank

Lagarde said for the US plan to work "it will require all the goodwill in the world on the part of all parties - private sector, public sector, international organisations and the parties on the ground and their neighbours."

Citing examples of post-conflict countries, Lagarde said that private investors needed progress in several sectors including strengthening the central bank, better managing public finance and mobilising domestic revenue.

"If anti-corruption is really one of the imperatives of the authorities - as it was in Rwanda, for instance - then things can really take off," she said.

Kushner says his proposals for infrastructure, tourism, education and more will create one million Palestinian jobs.

Read more: Why are the Palestinians boycotting?

Gross domestic product in the Gaza Strip declined by eight percent last year, while there was only minor growth in the West Bank.

Kushner, opening the conference on Tuesday, called the plan the "Opportunity of the Century" - and said the Palestinians needed to accept it before a deal can be reached on political solutions.

The Palestinian Authority has rejected the conference, saying that the US and Israel are trying to dangle money to impose a political settlement which will deny Palestinians their right to self-determination.

Washington says it will unveil the political aspects of its peace deal at a later date, most likely after Israel's September election.

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