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A high-tech bridge to Middle East peace?

Shimon Peres tells CNET News.com why he still believes that technology cooperation can lay the economic groundwork to help end the region's Arab-Israeli conflict.

Shimon Peres is reputed to be an incurable optimist, and maybe that's the right state of mind for anyone who's attempting to solve the seemingly intractable conflict between Israelis and Palestinians. Even after three years of conflict, he still sees a way out of the bloody stalemate.

"Economics and politics are symbiotic," says the former prime minister of Israel and co-winner of the 1994 Nobel Peace Prize, who argues that the technological rejuvenation of the region will go a long way toward breaking the logjam.

Peres played a central role in fostering the development of Israel's high-tech sector, which last year accounted for some $12 billion in exports compared with $3 billion in 1991. During that period, Israel earned a spot alongside the likes of India, China and Taiwan as an emerging tech hotbed.

Several Israeli companies have since gone on to fame and fortune, including instant-messaging pioneer ICQ and security software maker CheckPoint. Microsoft chose Israel for its first non-U.S. research and development facility, while Cisco's only overseas R&D facility is in Israel.

Like the rest of Israel's economy, the country's once-booming technology business has suffered sharp declines since the outbreak of the second Palestinian intifada. The nation's gross domestic product dropped last year by 2.4 percent, and unemployment now hovers around 11 percent. But Peres continues to believe that tighter economic integration and cooperation can create a coalition of common interests that will ultimately trump political differences.

Whether technology sharing will indeed spur cooperation in other fields remains an open question, but at 80, the still spry elder statesman has built a career by challenging conventional wisdom. He recently spoke with CNET News.com about why he expects bits and bytes to assume renewed importance, as the two sides again give peacemaking another chance.

Q: There's an old debate over whether economics drives political change or vice versa. Do you think people were overoptimistic about the role that technology and its development would play in helping settle long-standing political issues in the Middle East?
A: Economics and politics are symbiotic. People didn't err by pushing the notion of a high-tech infrastructure and joint projects. The results, until the second intifada broke out, spoke for themselves.

During the Oslo period, you talked about a future where high-tech ventures between Palestinians and Israelis would be common. How far back has that future been delayed by the violence of the past three years?

High-tech is not merely a technical matter.
While it is true that the interruption to the Oslo process delayed peace and slowed down the economic development of the peoples of the region along with their integration in the global economy, I nonetheless believe that the process will get back on track earlier than anticipated.

A two-pronged path should be taken: the fight against terror, as though there were no negotiations; and negotiations that are combined with a political horizon, as though there was no terror. Cooperation in the fields of agriculture, high-tech, employment opportunities, the economy, telecommunications, transport and tourism needs to be encouraged and expanded--for only on this basis will a real change in the political reality be accomplished.

High-tech was one of the Israeli economy's biggest success stories. To what degree is its future being put at risk by the absence of peace?
The absence of peace is affecting not only the Israeli high-tech sector--and not only Israel. The high-tech sector is mostly affected by a global crisis in this domain.

Before fighting derailed the peace process, how did you see the role of high technology working to bridge the political and economic differences between Israel and its neighbors?
High-tech is not merely a technical matter. High-tech also represents a set of values, such as transparency, fair-play, honesty and a search for truth. No one will invest in a country whose books are not open for scrutiny. Scientists will not operate in a country whose government treats its citizens with cruelty and is founded on lies. There is no deceitful science.

In a speech a few years ago, you said, "The Palestinians must be as advanced in high-tech as us. Our philosophy must be that the better the Palestinians have it, the better neighbors we will have." Still, there remains a wide disparity in the high-tech know-how on opposite sides of the Green Line. Given the political realities on the ground, how long will it take to resolve that imbalance?

Israel will be happy to put at the disposal of its neighbors its know-how in the field of high-tech and develop ties of cooperation in this and other fields.
I still stand by my statement that the better off the Palestinians, the better it will be for Israel. Economic growth will bring peace. Foreign investments in the territories should not be made directly, but rather serve to build an infrastructure for a modern economy and subsidize private companies to establish branches in the territories, providing appropriate employment opportunities and salaries.

When he was the Egyptian foreign minister, Amr Moussa (now head of the Arab League) routinely bristled about what he said was Israel's ambition to become the regional economic superpower. Given those sorts of suspicions, what's realistic? If and when peace breaks out, what do you think the regional role for Israel's high-tech industry should be?
Up to the outbreak of violence at the end of 2001, there had been a significant investment in broad aspects of a high-tech infrastructure: funding, industrial parks, technological inputs, promotion of projects and training programs. This involved, among others, nongovernmental organizations and the private sector--both locally and from abroad. Therefore, it is possible to build on the existing infrastructure and proceed to develop it further quite quickly.

Israel has no ambition to become the regional economic power. Its ambition is to see a prosperous and peaceful Middle East in which all the peoples living in the area will benefit from the tangible fruits of peace. Israel will be happy to put at the disposal of its neighbors its know-how in the field of high-tech and to develop ties of cooperation in this and other fields.

With today's trend in the world to create trade blocs, adopting this approach in the Middle East would be a sure recipe for a better future for all. Israel would like to see a modern economic quartet: Iraq, Jordan, Palestine and Israel. This concept has economic logic as well as territorial contiguity. Such a region should enjoy the status of an associate member of the European Union and a free-trade zone with the United States.

You grew up during a different era. Do you regularly use a personal computer or a personal digital assistant?
While I do not use a computer personally, the whole of my office is computerized. I watch with fascination as others demonstrate their computer skills--including my grandchildren.