Transcript: Peace and Prosperity in the West Bank?

BRANCACCIO: Everyone remembers Tony Blair - the former British Prime Minister - but did all of you track his latest career move? Join us to hear how Blair is now working to build peace in the mid-east from the ground up, town by town in the West Bank. The NOW team spent a couple of weeks in and around the city of Jenin to see if it's working. Correspondent Mona Iskander and producers Brenda Breslauer and Brian Epstein have our report on social entrepreneurs at work, part of a series we call, Enterprising Ideas.

ISKANDER: What's happening here may be the first step toward a new future for the West Bank. These workers are bottling locally made olive oil. One of the region's oldest products. The idea is to export both the olive oil and a new image of the Palestinian people all the way from this tiny village in the west bank to supermarket shelves around the world.

So that's a big deal, isn't it?

ABUFARHA: Certainly.

ISKANDER: Nasser Abufarha is a Palestinian-American entrepreneur. He's returned to his home town to create a cooperative of 1200 local farmers. Together they now produce top quality products branded with the name "Palestine."

This can be bought in the United States?

ABUFARHA: Yes, it can be bought in the U.S.

ISKANDER: Is that exciting?

ABUFARHA: Of course it is, because people are not used to encounter Palestine this way. They hear a lot of conflict and war and violence stories about Palestine but this is an alternative presentation of Palestine.

ISKANDER: He's invested about two and a half million dollars to build this bottling plant. But he says it was a risk.

ABUFARHA: This is a large investment. To have this kind of investment—without—political stability is difficult.

ISKANDER: That's because Abufarha's business is located in the west bank, under Israeli occupation. It's in a village just outside of Jenin, the northern most city in the Palestinian territories. Under the occupation, access to Israel is difficult if not impossible for ordinary Palestinians. And with more than 600 checkpoints scattered across the west bank, transporting goods is a challenge. Jenin, once a thriving commercial center, has been suffering from those restrictions. But today this city is at the heart of an international effort to lay the foundation for a future Palestinian state. The plan is to make Jenin a model for the rest of the West Bank, one that is both safe and economically prosperous.

BLAIR: I would say, this is the single most important issue for—for creating a more stable and secure world.

ISKANDER: For the past two years, former British Prime Minister Tony Blair has been the official envoy to the Middle East for the international community, including the United States. Blair supports a two state solution, the idea of a Palestinian state living in peace alongside Israel. But rather than getting there using only high level negotiations...a tactic that has led from one stalemate to another, Blair says he's trying something new

What makes your initiative so different?

BLAIR: What I'm trying to do is to say is, at the same time as you negotiate from the top down, a solution to these tricky and difficult questions, build from the bottom up. Build the—the capacity of the Palestinians to run their state, and build economic development.

ISKANDER: That means starting on the ground... like more freedom of movement for Palestinians, getting water and electricity to villages and building the infrastructure needed for an independent state. Security is the critical first step, Blair says, for both the Palestinians and the Israelis.

BLAIR: Unless the Israelis are sure that the Palestinian state is going to be secure and not a haven out of which terrorism is gonna come, then you know, they—they will not lift the weight of the occupation.

ISKANDER: Just a few years ago, the name Jenin was synonymous with violence. Thirty suicide bombers from Jenin attacked Israel from the year 2000 to 2002. In response, Israeli tanks invaded Jenin. It became known as one of the bloodiest battles to take place in the West Bank. But seven years later, something extraordinary is happening in Jenin. There is a brand new professional Palestinian security force in town. Today these Palestinian soldiers are training to capture violent criminals. It's part of the new plan to give Palestinians more authority over their own lives and to lay the foundation for a future state. Col. Radi Asideh is in charge of the new security forces in Jenin. When he began leading the troops two years ago, the city was in chaos.

ASIDEH: The biggest difficulty was the large number of armed men in the streets. Gangs, killers, drug smugglers, and other people who acquired weapons in this chaotic environment. So restoring security was the biggest challenge.

ISKANDER: Today he oversees 500 of these newly trained men in Jenin. Their task: to keep law and order and to prevent possible attacks on Israel. The United States has committed more than $160 million dollars to train and equip them. 1700 recruits have graduated so far. Today, they're deployed throughout Jenin and four other West Bank cities, with more on the way.

BLAIR: The big news, if you like, of the last 18 months is that with American support, the Palestinian security forces for the first time have been operating like proper security forces.

ISKANDER: We're with the Palestinian Security Forces in the back of one of their trucks. They've invited us to go around the city as they patrol, looking for criminals or anything else that looks suspicious.

Today's mission: to set up an impromptu checkpoint in search of weapons and stolen goods. On patrol, I spoke with Alaa' Il Deen Abed Il Latif... a recruit in training. His story is testament to just how much has changed in Jenin. He used to be a member of the Al-Aqsa Martyrs Brigade, a violent militia that sought to end Israel's presence in the West Bank by attacking Israeli settlers and sending suicide bombers into Israel.

LATIF: I was an ignorant young man... And I got involved with a group of guys from my town who were part of the resistance.

ISKANDER: He says he spent his life on the run evading capture by the Israelis...

LATIF: My life was very, very difficult. I couldn't even go to my house, or see my mother, or my brothers, or my neighbors. I wouldn't even go out into the street, at all.

ISKANDER: But now he finds himself leading a very different life... fighting for change within the system... when once he lived outside it.

RADI: We brought into reality the hope of the people of Jenin.

ISKANDER: Col. Radi Asideh says he is proud to have proved the skeptics wrong.

RADI: There were many people, among them the Israelis, who were betting on the failure of our security campaign. We succeeded and we proved it to everyone.

ISKANDER: Locals we spoke to say the city is much safer today. Mahmoud Issa is an olive farmer who lives half an hour outside of Jenin with his wife and five children. Two years ago, the streets were so unsafe, Mahmoud says, he wouldn't allow his children to walk home from school by themselves.

ISKANDER: Seeing Palestinians patrolling the streets, and taking the control of the area, does that give you hope for your future, for your children's future?

MAHMOUD: It gives me hope and peace of mind. In the past, if my wife wanted to go to Jenin I had to go with her. Nowadays, I'd feel safe letting her go on her own.

ISKANDER: Mahmoud's wife, Falasteen, says she too feels a new sense of security... giving her the freedom to move around on her own.

FALSTEEN: We go to Jenin for clothes, for school supplies or to see the doctor. I feel safe going by myself or even taking the children with me.

ISKANDER: Mahmoud says he used to be concerned that his oldest son, nine year old Mossab, might follow a violent path like so many young men in Jenin. but his son looks up to the men in uniform today and wants to be a police officer when he grows up.

MOSSAB: So I can defend my country, and catch those who break the law, and catch robbers.

ISKANDER: But to be a police officer, isn't that's a dangerous job?

MOSSAB: No problem.

ISKANDER: While the improved security in Jenin may be a sign of progress, the economy here is another story. Mahmoud, like many Palestinians in the west bank, is struggling to make a living under Israeli occupation. It's the end of the olive harvest in Jenin and Mahmoud is now preparing his soil for the next season. This land, he says, has been in his family for more generations than he can count.

MAHMOUD: You could say that the land means everything to me... there is an Arabic proverb..."He who let's go of his land, let's go of his honor."

ISKANDER: But what he just showed us is only part of his inherited land. Mahmoud took us to this fence, built by the Israeli army. Part of his farm is on the other side.

Can you go to the other side of this fence?

MAHMOUD: No, right now it's almost impossible.

ISKANDER: This fence is part of the larger separation barrier that Israel has built around the border of the West Bank. The Israel Defense Forces say it was created to protect Israelis from terrorism. The thing is, parts of the barrier were constructed miles into Palestinian land. On this hot morning in May, farmers and their families gathered to protest the fence. "Go away from our land", they chanted...while soldiers from the Israeli army stood guard, watching the gathering crowd from across the barbed wire. But this wasn't an angry mob throwing rocks at Israeli soldiers, it was an organized, political statement. The regions top politician, Governor Gaddoura Moussa, was there calling for change.

MOUSSA: This wall needs to go. The Palestinian farmer must reclaim his rights so that he can lead a normal life. But without bloodshed, without killing, without injuries.

ISKANDER: Like most of the Palestinians we met in Jenin, Governor Moussa is frustrated living under Israeli occupation.

MOUSSA: The people of Jenin used to live a relatively upscale life. But today they live in a bad economic and political situation.

ISKANDER: In the 1990s Jenin was thriving as Israelis...both Jewish and Arab flocked to the city to shop. but shortly after the Palestinian uprising began in 2000, the Israeli government prohibited vehicles from driving across this border. now consumers can only cross by foot, limiting what they buy to what they can carry.

MOUSSA: Today, not a single car from Israel can enter Jenin. Only about 100 to 200 Israeli citizens are allowed to enter Jenin each day.

ISKANDER: And that's choking the economy, he says. The unemployment rate today has reached 20 percent. But the governor is getting help from an unlikely source...an Israeli. Daniel Atar is a mayor in Gilboa, a bucolic region with rolling hills right across the border from Jenin.

ATAR: Our life will be better when the Palestinian's life is better. And that's mutual. I believe that. I don't believe that because they're Palestinians they have to suffer, and that because I'm Israeli I have to live a better life.

ISKANDER: So Atar has reached out to his Palestinian counterpart, the governor of Jenin.

You're an Israeli, he's in the West Bank. How is the relationship you have with Qaddoura Moussa?

ATAR: From my own personal perspective I'm very happy that we've built such a good personal relationship, that's based on trust in each other. But, sadly, it's unique to us.

ISKANDER: Today Atar and his deputy mayor travel to Jenin to meet with Governor Moussa. It sounds simple, right? Well, not really. This is the border crossing between Israel and Jenin. It looks like a maximum security prison. Before we can cross into the west bank from Israel, we have to leave our Israeli translator behind because he doesn't have permission to travel into the West Bank.

ALON: Be safe!

ISKANDER: In fact, it's so uncommon for Israelis to cross into Jenin that even an Israeli politician like Daniel Atar needed special permission. He also had to sign a waiver saying he was entering Jenin at his own risk. We had to meet up with our Palestinian translator on the West Bank side because like many Palestinians, she doesn't have permission to enter Israel.

LUBNA: I was born in the U.S., masters from Berkeley and I can fly to New York and Paris any time but can't cross over there to Israel.

ISKANDER: The leaders of these two neighboring regions have created their own model of Arab-Israeli cooperation from the ground up. This past year, Atar and his constituents in Israel donated a tractor and a much needed water tower to Jenin. But what really needs to happen, Atar says, is a large scale plan to create thousands of jobs for Palestinians in Jenin. And that's exactly what former Prime Minister Tony Blair has been focusing on during his many visits here. Blair's plan is to revitalize the economy by creating an industrial zone that would house much needed factories and bring in investors. Riding through the West Bank in his convoy, Blair says major projects, like his initiative, haven't happened before because violence and instability have scared off investors for years.

BLAIR: The people who are the extremists—they're—they're really only a small number. But the trouble is, you know, obviously they can have a disproportionate impact on the politics.

ISKANDER: But now with the new Palestinian security forces in place, he believes that Jenin is ready for business.

BLAIR: There's plenty of people who—who'd invest here. So, I mean, the only—I mean, I know it's a big problem, but the only problem is the politics really. There's no other, there's nothing else that would hold this place back.

ISKANDER: So we went looking for this industrial zone, and this is what we found. Nothing but some asphalt in the middle of an empty field. Not even one brick had been layed. Back on the streets of Jenin, locals we spoke to were skeptical about the prospects of Blair's plan.

There's a lot of talk of a proposed economic industrial zone here. Do you have faith this is actually going to happen?

RESIDENT: There is very little hope. Very little, very small.

ISKANDER: Overwhelmingly people wanted to know where is this economic industrial zone that you proposed two years ago?

BLAIR: Now I totally understand the frustrations of people. I mean, I equally get frustrated and impatient myself. You know, when you're talking about major scale industrial parks, where you've got to tie in the investors, make sure that you can get the infrastructure sorted out, and when it's been against the background —of years of this whole thing spiraling downwards—I don't think it's surprising it takes a bit of time.

ISKANDER: Blair admits that there is a massive amount of work to be done but the big news, he says, is that the new Palestinian security forces are keeping law and order. In January, when the Israelis invaded the Gaza strip, many feared unrest and even violence would break out in the West Bank. There were rallies and widespread demonstrations but no violence. And, for more than two years, not one person from Jenin has carried out a suicide attack.

RADI: Our campaign exceeded expectations and the Americans would attest to this. We achieved our goals with very few resources. We imposed the rule of law. And we stripped gunmen of their weapons. And we arrested all criminals.

LERNER: Maybe we do have a sense that there's—a sense of calm. But under the ground, under the surface, there is high motivation to carry out terrorist attacks against Israelis.

ISKANDER: Peter Lerner is a spokesman for the Israel Defense Forces. We met with him right over the border crossing between Israel and Jenin.

Do you trust the Palestinian National Security Forces?

LERNER: I think what we have is a very professional force, somebody who we can talk to at eye level. Somebody who we can work with on a professional basis.

ISKANDER: So, what I'm understanding is the trust isn't quite there yet? Full trust?

LERNER: I wouldn't necessarily say 'trust.' But there are—on the Palestinian side—from our view, they don't—still don't have the full capability to carry out everything to meet our security needs. Our security needs is to save Israeli lives.

ISKANDER: In fact, the Israeli army can still enter Jenin at any time. And from midnight until 6 am, the Palestinian forces must retreat to their barracks while the Israeli army takes complete control of the city.

If the goal of this security plan is for the Palestinians to eventually have their own state, how can they do that when Israelis come in at midnight and take over patrolling after midnight? How can that happen?

BLAIR: Well, it can't. And that's why you've got to—to change it over time. What I would say to you is, Jenin is absolutely work in progress. I mean, Jenin is not what it should be. Jenin is better than it was. That's my statement.

ISKANDER: To understand just how fragile the situation is, meet Zachariya Zubeideh. He grew up in the Jenin refugee camp, the center of the resistance here, a place where many suicide bombers came from. This tough neighborhood is plastered with banners to Saddam Hussein and posters of men who are considered martyrs. Up until two years ago, Zubeidah was the leader of the militant Al Aqsa Martyrs brigade in Jenin. His face is burned from a mortar explosion, evidence of his many years fighting Israelis.

ZUBEIDAH: I wouldn't harm civilians like women, children, young people. I wouldn't harm those Israelis but settlers and soldiers, no mercy.

ISKANDER: In 2002, during the battle of Jenin between the Israeli army and Palestinians fighters, Zachariya's brother and mother were killed.

ZUBEIDAH: After a sniper killed my mother, I had no mercy left in my heart. How could I show any mercy on that sniper? Whoever killed my mother, I will kill him.

ISKANDER: For years Zubeideh was on Israel's most wanted list and he spent his nights in hiding. But now he sleeps here, in this Palestinian authority security compound...along with other former fighters. That's because two years ago Zubeideh and nearly 200 other militants signed an amnesty deal and got a promise from the Israelis they would no longer be hunted down. In exchange, the militants agreed to renounce violence.

So, you've put down arms.

ZUBEIDAH: I did not lay down my weapons. I stopped militant activities and I've stopped the attacks. But of course I still have my weapons.

ZUBEIDAH: Are you carrying a gun now?

ZUBEIDAH: USA. Smith and Wesson.

ISKANDER: Zubeidah says he sees little hope for the future.

ZUBEIDAH: I know Israel will not give the Palestinians their rights and I know the return of resistance activities, armed activities is inevitable. It's coming back.

ISKANDER: Israeli politician Daniel Atar, who lives just across the border from Jenin, is worried.

ATAR: If we are able change the Palestinian's quality of life, we'll be successful in something that we've been working on for a number of years. If that doesn't happen, may god protect us. Without that everything will crumble - and the terror will return and the violence will return.

ISKANDER: What's your biggest fear here.

BLAIR: Well, my biggest fear is obviously, I think—it's urgent. You know, you've always got to be careful in these situations of saying, "There's a window of opportunity. It's about to close, you know," and all the usual clichés. But, I mean, I think you d—it—it is pretty urgent.

ISKANDER: And, he says, the urgency extends well beyond these borders.

BLAIR: I personally think, if we are able to make peace between Israel and Palestine—that it will change radically, dramatically, the nature of the relationship between Islam and the west. It will change the dynamics of this region. It will release a whole series of forces of modernization, moderation, and potential.

ISKANDER: And the seeds of that potential may be found right here in Nasser Abufarha's olive oil plant in Jenin. Businesses like this are creating opportunities for the Palestinian people and a new hope. Mahmoud Issa, the farmer who can't reach all of his land because of the Israeli fence, used to struggle to provide for his family...until he met Abufarha. Now Abufarha pays Mahmoud a fair price for his olive oil ...and then sells it abroad to an international market that Mahmoud never could have reached on his own.

ABUFARHA: In Palestine there is this feeling that we've been left out. We've—we've been let down by the world community. So this is bringing a—a—a new light of hope for our farmers.

BRANCACCIO: You've just seen one set of views on prospects and challenges for peace in the Middle East. Now, prepare for another. Next week we'll go where few have gone before - inside the Israeli Defense Force to get Israel's perspective on this thorny international conflict. And that's it for now. From New York, I'm David Brancaccio. We'll see you next week.

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