Addressing the United Nations' Ad Hoc Liaison Committee for Assistance to the Palestinian People (AHLC) on Monday, Minister of Foreign Affairs Tzipi Livni declared Israel's support for the creation of an Arab state in Judea, Samaria and Gaza.

The Foreign Minister said that pouring money into the PA will not be sufficient.

However, she also strongly defended Israel's current security measures in those areas.

"We have gathered here with the common purpose of helping to build the foundations of the Palestinian state," Foreign Minister Livni began, adding that such a state "is an Israeli interest. On this principle, there is no conflict. On the contrary - Israel is committed to the establishment of a viable and vibrant Palestine, in the West Bank and Gaza, as a homeland for the Palestinian people and a peaceful neighbor to Israel. This is a shared vision, not a zero-sum game."

Livni furthermore declared that Israeli support for the transformation of the Palestinian Authority into an additional Arab state is a policy that "will not change even in difficult periods of violence and terror."

The AHLC is a United Nations committee established in 1993 as a coordination mechanism for development assistance to the Arabs of the PA. According to the UN's official description, "This forum seeks to promote dialogue between donors, the Palestinian Authority and the Government of Israel." Members of the AHLC are Canada, the European Union, Japan, Norway, Russia, Saudi Arabia, the United States and the World Bank. Associated members are the Palestinian Authority, Israel, Egypt, Jordan, Tunisia, and the United Nations itself.

Monday's meeting of the AHLC, Foreign Minister Livni said, was made possible only by "the emergence of a Palestinian government, under the leadership of President Abbas and Prime Minister Fayad, that accepts the Quartet principles and is determined to lead the Palestinian people to a better and more peaceful future." Israel, along with other Western nations, had refused to hold discussions with the PA under Hamas leadership.

Indirectly offering state-building advice to the PA leadership, the Foreign Minister said that pouring money into the PA will not be sufficient for "turning the Palestinian state into a reality.... It is about building efficient and responsible government institutions, ensuring law and order, securing and maintaining monopoly over the use of force, and general capacity building. It is about encouraging local enterprise, supporting the private sector and creating conditions for foreign investment."

Calling the current situation in Israel "more complex than ever before," Livni said that "it also presents new opportunities which we must fully exploit. A Palestinian state must not remain a slogan. It must be built from the ground up. It must be given substance in a way that serves the vision of two states, two homelands, living side by side in peace and security."

'Israel Faces an Intolerable Dilemma'

As for the Hamas regime in Gaza, Foreign Miniser Livni called it a ":challenge" posed "to Israel, to the Palestinian people, to the international community and to the peace process itself."

Foreign Minister Livni said that Israel faced an "intolerable dilemma, with no easy solutions." She referred to Israel's full and unilateral withdrawal from Gaza, saying, "We have received only terror in return. The families of Sderot and neighboring communities are terrorized daily by missile attacks on homes, shops and kindergartens. Gilad Shalit remains in captivity. Hamas is smuggling weapons to enhance its arsenal, increasing the range of its missiles, and suffocating the voices of hope and co-existence wherever it can." 

Without specifically mentioning the recent Israeli declaration of Gaza as "hostile territory" and threats to limit fuel and electricity to the region, Livni told the AHLC, "We cannot afford to ignore this situation.... There is no leader in this room who would tolerate this situation in their own country. And we cannot tolerate it in ours. While we remain committed to the humanitarian welfare of the civilians of Gaza, we cannot relate to the territory from which our citizens are under constant assault as though it is business as usual."

Regarding IDF checkpoints in Judea and Samaria, the Foreign Minister said, "We have no desire to impose hardship on Palestinians and are ready to make progress on these issues. But the life of Israel's citizens is not less important, and there are, unfortunately, too many people who wish to undermine the hopes for peace. Just as a Palestinian state is an Israeli interest, so Israeli security must be a Palestinian interest. And while we must seek to improve economic conditions and quality of life, we cannot afford to give the enemies of peace the opportunity to succeed."

"There is no leader in this room who would tolerate this situation in their own country." - FM Livni

Israel's Assistance to Abbas's Regime

Foreign Minister Livni went on to delineate the steps Israel has taken and is planning to take to help the Fatah-led government of Mahmoud Abbas. She specifically mentioned:

"Releasing withheld tax and customs revenues. Releasing hundreds of Palestinian security prisoners, including an additional 90 prisoners decided upon only yesterday. Providing amnesty to 180 suspected terrorists, despite the security risk entailed. Supporting trilateral and multilateral projects such as the Japanese agricultural project in Jericho and Turkey's initiative to establish an industrial zone in the West Bank. Encouraging contact between the Israeli and Palestinian private sectors. And working to renew the activity of the Joint Economic Committee, the JEC, in order to advance economic ties."

Livni also said that the Israeli delegation would be "presenting ideas for enhanced cooperation particularly in the financial, judicial and economic spheres."

The Foreign Minister concluded her remarks by saying, "We have been given the historic opportunity to transform the two state vision from a dream into a reality. I believe we can succeed in this task, if we make the right decisions, and if we act with courage, determination and some basic common sense. Future generations will not forgive us if we fail."