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European Council on Foreign Relations




According to the assumptions of the Quartet (which consists of the US, the EU, the UN, and Russia), territorial arrangements under a two-state solution would result in a Palestinian state based on the 1967 lines that consists of a territorially-contiguous West Bank linked to the Gaza Strip – by a land corridor, a secure highway, overpass, or tunnel, as set out in most detailed proposals for a two-state solution.

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The Oslo Accords defined East Jerusalem as an issue to be settled in a final status agreement, and it is difficult to envisage a two-state solution that does not address this issue. The Palestinians recognise Israeli claims to West Jerusalem, while the fate of the Old City remains a contentious issue. Israeli fears over continued access to the holy sites in the event of a final status agreement persist and have traditionally been part of the equation during peace talks. Conversely, there is no Israeli consensus regarding acceptance of occupied East Jerusalem as being Palestinian.

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A quiet security environment is widely considered most conducive to progress toward a two-state solution as it gives breathing space to political decision makers and facilitates public support for negotiations and compromise. This category looks at different factors that shape the security environment.

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While negotiations between Israelis and Palestinians are the focus of efforts to produce a lasting political agreement, the ability and willingness of third parties to shape the positions of, encourage, and exert leverage over both sides in order to create conditions conducive to successful negotiations and the full implementation of a prospective agreement are also deemed to be crucial. Experience would suggest that bilateral negotiations are in need of strong and decisive international support and perhaps relevant and externally-generated incentive and disincentive structures.

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Key to a comprehensive two-state solution will be the ability to address the Palestinian refugee issue by mutual agreement. This, as proposed through different parameters and terms of reference since Oslo, implies that the number of refugees who would actually be allowed to assume residence in/return to Israel would be limited. The vast majority of refugees are therefore likely to live in the new State of Palestine, to be rehabilitated in current host countries, or relocated in third countries.

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The Palestinian debate

Since the 1970s, the Palestinian Liberation Organization (PLO) was largely accepted as the unchallenged representative of the Palestinian people. But, in the intervening years and in particular, since the inception of the PA in the 1990s, the question of who legitimately speaks for the Palestinians has become more contested. The question of whether Palestinians have legitimate and representative institutions is of special concern given that (a) Palestinian institutions (especially the security forces) are so heavily funded with external support; and (b) Israel increasingly argues that Palestinians lack the decision-making capacity to strike a deal.

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The Israeli debate

Under Israel’s present system of government, a peace agreement with the Palestinians that entails withdrawal from territory would need to carry a parliamentary majority and, if current coalition agreements stand, also pass a referendum. As Israel’s coalitions cover at least some spectrum of opinion on peace talks (and as there is always some political capital in representing the voters’ misgivings about any withdrawal from the West Bank), this challenge is not to be taken for granted, even in the event of a prime minister strongly committed to pursuing a two-state solution.

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