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Cablegate: Netanyahu Outlines for Ambassador Likud's Way

VZCZCXRO8097
OO RUEHROV
DE RUEHTV #2617/01 3291439
ZNY CCCCC ZZH
O 241439Z NOV 08
FM AMEMBASSY TEL AVIV
TO RUEHC/SECSTATE WASHDC IMMEDIATE 9297
INFO RHEHNSC/NSC WASHDC IMMEDIATE
RUEHXK/ARAB ISRAELI COLLECTIVE PRIORITY

"S E C R E T SECTION 01 OF 02 TEL AVIV 002618

SIPDIS

E.O. 12958: DECL: 11/25/2018
TAGS: PREL PGOV PINR IS
SUBJECT: NETANYAHU OUTLINES FOR AMBASSADOR LIKUD'S WAY
FORWARD WITH THE PALESTINIANS

REF: TEL AVIV 2617

Classified By: Charge d'Affaires Luis G. Moreno, reasons 1.4 (b),(d)

1. (S) SUMMARY: In a private meeting with the Ambassador on
November 20, Likud Party leader Benjamin Netanyahu
confidently described his prospects to become the next
Israeli prime minister and outlined his intent to form a
broad, center-right coalition if his party prevails in
February. Netanyahu assured the Ambassador that he intended
to continue negotiations with the Palestinians, but his
strategy would be to avoid discussing final status issues,
which foiled all previous negotiations, and instead focus on
an ""economic peace plan."" Netanyahu's vision would have
Israel working with Jordan and foreign donors to inject
large-scale investment in the West Bank to improve the daily
lives of Palestinians. He added that he is not interested in
Israel controlling the Palestinians, and that he would give
them all sovereign powers except those that could endanger
Israel. END SUMMARY.

--------------------------------------
NETANYAHU OPTIMISTIC ABOUT ELECTIONS,
PROJECTS BROAD, CENTER-RIGHT COALITION
--------------------------------------

2. (S) The Ambassador met with Likud Chairman Benjamin
Netanyahu privately on November 20. Netanyahu was in an
ebullient mood, the latest polls showing him with a growing
Likud lead over Kadima (reftel). While cautioning that it is
early to draw conclusions, he raised the possibility that the
elections might turn out to be ""a rout"" as the tide of the
political battle may be turning strongly in Likud's favor and
away from Tzipi Livni's Kadima Party. He credited this to
his own work over the past few years in broadening his
support and attracting the return of major Likud Party
figures such as Benny Begin and Dan Meridor (""they balance
each other""), to Kadima,s failure to lead, and to Ehud
Barak,s inability to prevent Labor,s collapse. As a
result, Netanyahu feels that he is in a strong position to
lead from the center right. While projecting that the
February elections might re-draw Israel,s political map, he
said he would not repeat his ""mistake"" in 1996 when he
rejected a national unity government. This time, Netanyahu
said he will seek a broad coalition given the gravity of the
economic and security issues he will face (and which will
presumably give him greater room to maneuver between left and
right).

---------------------------------------------
""ECONOMIC PEACE PLAN,"" NOT FINAL STATUS TALKS
---------------------------------------------

3. (C) Netanyahu tried to assure the Ambassador that he did
not intend to abandon negotiations with the Palestinians, and
pointed to his speech closing the United Jewish Communities
General Assembly as the latest expression of his thinking on
an ""economic peace plan."" His overall plan calls for
continuing diplomatic negotiations with the Palestinians,
regional cooperation with Jordan, and massive investment in
the Palestinian Authority (PA) in order to give the
Palestinians an incentive to seek peace - and the ability
eventually to implement a peace agreement.

4. (C) Netanyahu said that negotiations between Israel and
the Palestinians have not progressed because they focused on
final status issues like Jerusalem and refugees - deeply
contentious matters on both sides - rather than on the
economy and improving the lives of Palestinian citizens.
Attempts to ""reach a deal on Jerusalem or bust"" would again
end in failure; ""I will negotiate, and I,ve shown in the
past I can compromise. But even if I were to negotiate on
Jerusalem, nothing would happen, as it never has."" He
believes the Annapolis approach, which he was careful not to
address directly, will not work because the development of
the PA/West Bank will be too slow to support a final status
agreement. Netanyahu,s alternative vision would have
negotiations and perhaps interim agreements as in the past,
alongside intensive economic development in parts of the West
Bank that would offer Palestinians tangible and significant
improvements to their lives. ""I know how to do this, and I
can change the dynamic on the ground in a year. I will lead
this effort myself, not delegate it."" He explained that he
has firm ideas he would seek to implement - some immediately
upon taking office - including tourism projects in Jericho
and factories in West Bank urban areas. When I asked about
security, he said the IDF would continue to work with PA
security forces, but that he would create economic projects
in areas where access and security could be guaranteed. He
anticipates that his plan would result in an increase in
growth in Palestinian areas by 10 percent each year, with
clear results achieved within the first six months.

TEL AVIV 00002618 002 OF 002

5. (C) Netanyahu would seek economic cooperation with Jordan
in the West Bank, and he has met with Quartet envoy Tony
Blair to discuss ways in which the former British premier
could help. He explained that he is not interested in Israel
controlling the Palestinians, and that he would give them all
sovereign powers except those that could endanger Israel,
such as control over borders and water, or entering into
treaties, or maintaining defense forces.

--------------------------------------------- -
TOUTS ABILITY TO DELIVER MOST OF THE RIGHTWING
ON AGREEMENTS WITH PA; WARNS THAT IRAN COULD
DERAIL ANY MOMENTUM
--------------------------------------------- -

6. (S) ""I can deliver two thirds of the Israeli right-wing on
anything we agree with the Palestinians,"" whether on process
or interim agreements. He allowed that one-third would
continue to reject any deals with the PA, but he has been
clear with his new recruits/returnees to Likud and potential
coalition partners about his goals. He said he favors the
two-state model, but it is not possible now. ""If President
Obama will work with me, we can make real progress.""
Netanyahu is aware that if Likud wins, his election and
program will be greeted with suspicion, and the Ambassador
noted that depending on how things evolved, Netanyahu might
never get a chance to get into negotiations if he is not
viewed as serious. He seemed confident he could manage the
re-balancing he has in mind, saying, ""I know how to
compromise, but I also know how to produce results."" The
thing which could derail everything, he said, is Iran. If
Iran crosses the nuclear line, the peace process will be
impossible with Syria or the Palestinians and the entire
regional dynamic will change. This has to be prevented. The
Ambassador replied that one could argue as well that the
demise of a credible negotiation with the Palestinians could
also alter the regional dynamic and make it much more
difficult, if not impossible, to shore up stability in the
region and to successfully confront Iran, which is the major
threat.

********************************************* ********************
Visit Embassy Tel Aviv's Classified Website:
http://www.state.sgov.gov/p/nea/telaviv

You can also access this site through the State Department's
Classified SIPRNET website.
********************************************* ********************
MORENO
"

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