Wednesday, March 18, 2009


Because my preceeding blog, karlmarxwasright, is NOT available to the public, for reasons unbeknownst to me, I am reposting, below, a 2005 entry which consists of excerpts from a 1995 WSJ article regarding the Palestine Telephone Company (Patelco) since it is related to current developments, namely, the above, Israel-Palestine Investment, Jerusalem Wealth Management Conference.
I highlighted Patelco's name in BOLD where it occurs.
So, the following from 1995, first posted 2005:

August 13, 2005

Unlikely Paris Duo Advises Palestinians on Development Deals

A LENGTHLY article appeared in the Wall St. Journal years ago, February 2, 1995, which I still retain. It's entitled,

Unlikely Paris Duo Advises Palestinians on Development Deals:

"...a revamped phone system was to be one of the first benefits that Arafat planned to deliver after signing the Sept 1993 accords granting Palestinian autonomy to the Israeli-occupied territories...Instead, 17 months later, the creaky old phone system, which the Israeli company still operates, has emerged as a symbol of something quite different... has brought to light the surprisingly important, sometimes hidden roles being played by two unlikely advisers to Arafat...One is 35-year old Pierre Rizk, former intelligence chief of the Lebanese Christian militia, which is closely linked to Israel's military.
The other is Gabriel Banon, 66, a Moroccan-born Jew with close ties to the Israeli military and with a checkered business history in the US and France. Both men live in Paris........
....As it stands now, Internat'l Technologies Integration Inc., an obscure company in McLean, Virginia, with ties to a mysterious limited-liability concern based in the Cayman Islands, hold the exclusive contract to develop the Palestinian phone system.
But so, it seems, does AT&T..rival MCI...a third still vying for the phone system work... Palestinian official suggests that the 2 advisers provide Arafat with a way to maintain his independence from potential rivals within the wealthy Palestinian community at home and abroad.
In addition, the official says, Arafat may believe that, with their international connections, they can help him get outside funding for political, as well as development activities and 'lubricate any bottlenecks.'.....
....Arafat's spokesman, Marwan Kanafani, says...'they are not paid...just advise the president...'
....However, Mr. Banon says he is, indeed, 'in the budget' and is being paid out of funds donated by several countries, which he won't name. .....
....Though based in Virginia, ITI is controlled by Chairman Nizar Dalloul, the son of Lebanon's defense minister and a son-in-law of it's prime minister, Mr.Rizk...
.....On Oct 3, 1993, less than 3 weeks after the accord was signed at the White House, Arafat and ITI's, Mr. Schonacher met in a villa in Tunis, according to a person who was present. There they signed a contract granting obscure ITI 'the exclusive build operate and exploit an International and Domestic Telecommunications network' in the Gaza Strip and the West Bank, according to a copy of the accord.
The agreement...garaunteed rights for 25 years...favorable to ITI...exempted the company from 'taxes, duties, fees, levies and other impositions' by the new Palestine Authority and any successor gov't. ...stipulated that loans or grants obtained by the Palestine Auth or future gov'ts from internat'l donors specifically for telecommunications 'would be made available at no cost' to ITI. The contract mandated that 'no press releases or other public disclosures' would be made....
....ITI's corporate pedigree is murky. ITI says it is part owner of Patelco, a new company formed to operate a revamped phone system. Patelco is registered in Delaware as a limited-liability company; as such, it doesn't have to disclose its officers or directors--and won't...
....According to Mr. Schonacher, Patelco's ownership is shared with a company called Tremoilles Investments, Ltd., based on Grand Caymen Island, a tax haven known for its weak corporate-disclosure laws. The owner or owners of Tremoilles couldn't be determined...
....Unaware of the existence of ITI contract, reps of AT&T travelled to Tunis last May--7 months after the ITI deal was inked--to make their own bid.... ....a month later AT&T was informed it had lost out to ITI... ....US gov't officials, who had discussed the ITI deal with AT&T, had concerns as well. Though ITI was saying it had joined forces with an MCI unit...a move that would bolster ITI's status, the Commerce Dept couldn't immediately confirm the existence of any such agreement.
COMMERCE SEC'Y RON BROWN [my emphasis] telephoned the Palestinian leader on June 1 to urge AT&T get the contract... But, with some Palestinian officials also favoring AT&T, it was clear that pressure was mounting to push ITI aside.
Enter Mr. Banon... Banon brought an unusual background to his role...An industrialist and onetime policy advisor to French Pres. Pompidou, Banon ran the French subsidiary of Alfa Laval AB, a Swedish manufacturer, in the1970s. Leif Rogersson, Alfa's current president, says Banon was dismissed after the French unit experienced business difficulties... ....He also engaged in at least 2 controversial business ventures in the US in the 1980s....
.....After Sept, 93,...Western nations meeting in Washington pledged $2.4billion to assist the rapid economic development of the West Bank and the Gaza Strip...Two months later...Banon showed up at the US State Dept to discuss the management of the pledged funds... ....State Dept officials told him...funds would be disbursed only for specific projects identified and approved by the World Bank.
Undeterred, Arafat soon afterward put Banon in charge of a new entity, Strategic and Development Policy Advisors, Inc... ....But, neither Rizk nor Banon could stop the AT&T negotiations from proceeding along the completely seperate path created by the Palestine Economic Council for Development and Reconstruction...last Oct, AT&T signed and exclusive agreement with PECDAR. Thus, both ITI and AT&T now hold contracts, though no one has been paid yet and it remains unclear who, if anyone, will..."

A footnote.
I emphasized Ron Brown's name, for those of you who might not remember, because he died in an airplane crash in Yugoslavia, ostensibly an accident, but I believe he may have been murdered.
He was on a "high powered" economic mission at the time of his death.

And, finally, see today's third entry, just below...

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