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News Analysis: in Casablanca, Success is Measured by Volume of Business Cards Exchanged

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EXCHANGED The measure of the success of this week’s conference on economic cooperation in the Middle East, according to the governor of the Bank of Israel, Jacob Frenkel, is “not the number of projects agreed on, but the number of business cards exchanged.”

By that measure, the sumptuous summit held this week at the royal palace of King Hassan II in the heart of Casablanca was a roaring success.

The 2,000-odd businessmen and 500 additional ministers and senior officials from 65 countries wandered through the glittering halls and lavish meeting rooms, their pockets stuffed with newly exchanged business cards.

Gallons of sweet Moroccan tea were drunk on low couches by Israelis avid to make new friends in the region and by Arabs showing a first-ever willingness to pay attention to the Israelis.

The peace process in the Middle East, though not yet complete and not yet comprehensive, has evidently made its mark on the region’s business leaders, who showed here their willingness to treat their Israeli counterparts with civility.

Hassan, the summit’s host, along with U.S. Secretary of State Warren Christopher and many other speakers at the summit, urged the Arabs to do away with their decades-old boycott of Israel altogether, and not make do with the abrogation of the secondary and tertiary boycotts recently announced by the Gulf Cooperation Council.

Significantly, their calls met with a half-positive response from the Arab side: the Arab League announced from Cairo during the Casablanca summit that it would take up the issue of the boycott at its plenary session early next year.

Foreign Minister Shimon Peres said the conference, which gave Israeli and Arab business executives their first opportunity to make contact in an open forum, was proof that the Arab boycott of Israel was over.

“The boycott has died, even if it has not been formally buried,” Peres told Israel Television. “The negative union for the boycott is being replaced by a positive one for economic cooperation.”

On Tuesday, Hassan closed the historic three-day conference, known officially as the Middle East-North Africa Economic Summit, by issuing a 14-point “Casablanca Declaration.”

The declaration called for a partnership between government and business to develop the economies of the Middle East and North Africa.

The conference also established first-ever regional economic forums for tourism and commerce, and set up a permanent secretariat to follow up on the summit’s deliberations.

Despite Israeli efforts, the formation of a regional development bank was not announced, after Saudi Arabia as well as several other Arab nations expressed reservations about the plan.

The Saudis in particular said they could not provide financing for the bank because of their own difficulties dealing with an increasing debt burden caused by a decade of flat oil prices.

Instead, the delegates decided that a staff of experts from the region will study the proposal and submit recommendations for such a bank in six months.

Although there were few concrete developments or business deals that emerged from the conference, Israeli delegates were pleased to find themselves on an equal footing with their Arab counterparts, who have largely shunned all relations with the Jewish state since its founding in 1948.

Delegates at the conference made a general call to remove obstacles that hinder economic growth in the region. They also called for open borders between Israel and the Palestinian autonomous zones of the Gaza Strip and West Bank Jericho enclave.

Morocco’s king specifically urged Israel to lift the closure on the territories, put into effect after the Oct. 19 terrorist attack on a Tel Aviv bus that left 23 dead. Israel had already lifted the closure by midweek.

The conference was also a channel for developments on the diplomatic front.

On the final day of the summit, Israel opened a liaison office in the Moroccan city of Rabat. Morocco is expected to open a similar office soon in Tel Aviv.

Peres and his Tunisian counterpart, Habib Ben Yahia, announced that the two countries would soon open liaison offices in each other’s countries.

Both Morocco and Tunisia established lower-level ties with Israel earlier this year.

Peres also indicated that the Persian Gulf states of Bahrain, Qatar and Oman may be next in line to establish ties with Israel.

Delegates at the summit agreed to reconvene next spring in Amman, Jordan, and later in the Persian Gulf state of Qatar.

These developments provide the structure for further progress on the regional economic front.

But despite such progress, key participants from the private economic sector and the political realm remain cautious, even after Casablanca.

One leading Israeli industrialist said he had been told outright by potential Jordanian customers that there could be meetings and talks between them – though not in Israel – but no deals would be made until Israel’s occupation of Palestinian land ended.

Another Israeli delegate, representing a major financial conglomerate, similarly reported frank and freewheeling conversations – but no “tachlis,” or concrete results.

He, too, acknowledged that while “tachlis” depends on locating projects of mutual interest and the financing to set them up, it first depends on the Arab business community reaching the conviction that the Israel-Arab peace is indeed irreversible.

The key, according to these two Israelis, could be a breakthrough on the Syrian-Israeli track, and/or a surge forward with the Palestinians.

“Arab businessmen want to feel sure that the Palestinians will get their state,” said the industrialist, who asked not to be identified.

“I am merely defining the facts,” he added, “not taking a political position.”

Beyond politics, there is also a vague but often-mentioned feeling among the Arabs that Israel is out somehow to “dominate” them economically.

The term “colonization” is even used in this regard, and the Israelis at Casablanca had their work cut out to reassure their Arab counterparts that their country and their specific companies harbor no such intentions.

This task was made particularly difficult by the fact that Israel came to the conference with one of the largest delegations. Many of the Israeli delegates came with spouses in tow. And no fewer than eight Cabinet ministers, including Prime Minister Yitzhak Rabin, joined in the fun at Casablanca, with many of them bringing an elaborate entourage of aides and each determined to attract media attention in order to justify his or her trip.

But in order for business ties to succeed, both Arabs and Israelis will have to get used to each others’ styles. The Arabs will have to get used to the Israelis’ brashness and foibles, just as the Israelis will have to adjust to the cautious, subtle and deliberate way of doing business in the Arab world.

Such adjustment will not happen overnight, according to seasoned observers. Israeli media predictions of a splurge of joint Arab-Israeli projects are at best wildly premature.

Nonetheless, the events at Casablanca added a significant component to the historic stride forward Israel has been making with its Arab neighbors.

In the words of Nimrod Novik, an Israeli diplomat-turned-businessman: “One day – next week, next year – I will be thinking of some idea and suddenly I’ll remember a conversation I had here in Casablanca, look through my collection of business cards, and tell my secretary, `Please get so-and-so in Bahrain or Tunisia or wherever – he may be interested.'”

Meanwhile, the Israeli business community, already thriving in the domestic prosperity induced by the peace breakthroughs with the Jordanians and Palestinians, is also benefiting from the half-thaw with the Arabs in terms of its relations with Western businesses.

As Yehuda Bronitzki, chief executive officer of Ormat Turbines, Israel’s largest manufacturer of solar energy units, put it: “European, Japanese and American businessmen who used to be afraid of doing business with us are now searching us out.”

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