Towards Economic Development in East Jerusalem Now

1. Towards Economic Development in East Jerusalem Now A Strategic Approach by the Jerusalem Policy Forum

2. Context – Where we are going? Raed

3. …Where we want to go… • Improved and sustained economic activity that is beneficial to both Palestinians and Israelis • Stable Employment – Jobs and Income • Economic Growth and Opportunity • Change the priorities for governance… FROM Politics and Security TO Economics and Investment Raed

4. Economic Activity Strengthen economic interdependence “Rebrand” Jerusalem as an internationally-recognized economic area Sustainability Build on competitive competencies Institute a fair and equitable tax structure and services Preserve and protect of private property Taking the Right Approach… Raed

5. …Will Require the Capacity to Act Strategically… Capacity to Plan and Act on a Sustained Basis Policies Programs Projects Fairness Sustained Efforts Employers Opportunity Jobs Quality of Life Capacity Incomes Steve

6. Symptoms Many organizations Mix of agendas, geography, & leadership Competing for scarce resources Causes No professional economic development staff No focused economic development strategy Limited public consensus about development Key Recommendation:Build Capacity, Set Direction, and Ensure Accountability… Initiatives • Jerusalem Economic Forum • Economic development strategy • Secure International 3rd Party to Monitor Implementation Organization & Strategy R

7. Mission guide strategy development Manage project development and implementation monitor strategy implementation Composition Reps from leading sectors (e.g. tourism, health, education, retail, etc.) Palestinian/East Jerusalemites Management & Organization Professional staff Leverage partnerships with “existing” organizations (e.g. Chamber of Commerce, JPF, etc.) Tasks and Activities Evaluate the market situation & identify short and long term market opportunities Develop consensus on economic development policies and programs; Identify priority projects in the economic development strategy Manage the preparation and implementation of the economic development strategy Work with public and private developers in formulating, planning, and implementing economic development projects Track economic development projects and monitor economic development progress. Detail: Jerusalem Economic Forum Steve

8. Mission To ensure implementation of the economic strategy, including policies, programs, and projects Composition Reps from international bodies with a supporting in the economic strategy Tasks and Activities Establish benchmarks for performance Collect data about outcomes Report on monitoring efforts Detail: 3rd Party Monitoring Steve

9. Symptoms Uncompetitive tax situation Limited public services available to business and communities Causes High tax burden on real estate Unfair tax burden on certain industries compared to competitive locations Examples of Policy Initiatives Initiatives • Evaluate the equity and application of business, property, and personal income taxes • Recommend policies for tax equalization to ensure competitive industry Taxes Raed

10. Symptoms Limited building development activity Limited investment activity Causes Building permit unapproved for development in East Jerusalem Incentives unavailable and/or unsuited for E. Jerusalem Examples of Policy Initiatives Initiatives • Enforce development laws • Permitting • Incentives “Favorable” Enforcement Raed

11. Symptoms International business not locating in Jerusalem Declining key sectors, such as Tourism Causes Uncompetitive trade policies with international markets Stigmatized location by international organizations Examples of Program Initiatives Initiatives • Target recruitment • Capital Improvement Program to Enhance “Jerusalem Brand” • Regional co-marketing initiative for Tourism industry Business Development Raed

12. Symptoms Declining key sectors, such as Tourism Causes Lack of capital investment in Hotel room supply Reduced tourist activity Available incentive programs not geared to East Jerusalem Hotels and owners Examples of Project Initiatives Initiatives • Rehabilitate hotel room to enhance regional marketing and tourism activity Key Industry Development Raed

13. Proposal Capital investment in underutilized hotel room supply in E. J. Rationale Shorten time to market reduce capital cost Partners Hotel owners and operators in E Jerusalem Cost $30M long term secured financing Outcomes 1000 rooms increased tourist penetration into E. Jerusalem increased overall capacity in Jerusalem Example: Rehabilitate Hotel Rooms Raed

14. What We Need…Now • Consensus and international support for the approach • Support the costs of establishing and operating the Jerusalem Economic Development Forum for 3 years • Support the costs of identifying, recruiting, and hiring a professional economic development staff • Intent to support and leverage others to support priority economic development programs and projects. Raed

15. End

16. Symptoms No air access to East Jerusalem region Air Access needed for Tourism sector and international business No free access; all access controlled by Israel Causes Difficulty securing air corridor around Jerusalem May compete with B-G for international travel Examples of Project Initiatives Initiatives • Evaluate the financial and security issues for opening the Qalandia Airport; prepare and implement a plan for the airport Access Steve

17. Symptoms Deteriorating business districts Limited services available to local residents Low quality public spaces Causes Limited funding for public spaces No coordinated plans for neighborhoods Underperforming businesses in neighborhood business districts Examples of Project Initiatives Initiatives • Identify plans for the redevelopment of neighborhood business district throughout East Jerusalem, including public improvements, business development, and financing options Business Districts Raed

18. Symptoms Little or no investment by International business community Few relocations and/or expansions Causes Jerusalem is stigmatized as “disputed” territory; unclear what jurisdiction and benefits may apply Few high quality sites and buildings “ready to go” Examples of Project Initiatives Initiatives • Model for an International District in Jerusalem • “Ready” sites and buildings to house business interested in East Jerusalem locations International District Raed

19. Proposal Create globally-competitive international business zones in the Jerusalem region Rationale International business require “conflict free” development areas Create stable areas where Israelis, Palestinians, and International business can work together Partners Jerusalem Development Authority Palestine Investment Fund Outcomes Benchmarks for district performance Model of legal, financial, infrastructure, development, and governance issues Alternative implementation strategies Detail: International District Steve