While economic issues have not been a driving force in the Arab-Israeli peace process in the past, they are sure to play a critically important role in the historic negotiations looming ahead. Across the wide Sinai expanse, Egypt and Israel have little to show in the way of economic ties, but their peace—“cold” as it is—still survives. The next phase of Middle East peace talks, however, will focus on Israelis, Palestinians and Jordanians who are already connected by a web of intricate and overlapping economic relationships. For them, economic and politics cannot be divorced.
If a secure and lasting peace is to be forged between Israel and its neighbors, understanding the economic implication of potential peace options is a vital prerequisite. In this Policy Paper, Patrick Clawson and Howard Rosen present the results of their year-long study into the economic consequences of peace.