Thirty-one years after Jerusalem was united under Israeli sovereignty, the battle for the capital's future is raging.

Reaction to the announcement in June of an Israeli plan to expand Jerusalem's municipal services provided a foretaste of the confrontation to come as May 1999—and Yasser Arafat's promise to declare an independent state—draws nearer.

In terms of the plan, the city will expand its boundaries to include several rural communities in "Israel-proper" to the west, and simultaneously establish looser administrative ties with other Jewish communities, which are located in disputed territory to the east.

The announcement aroused fury in Arab capitals, and strong disapproval from Western governments. Arafat said the plan could mean "the total destruction of the peace process" and called for an Arab summit to formulate a response. His charge that it constituted a violation of the Oslo accords was denied by the Netanyahu government, which noted that the plan had administrative, rather than political significance. On the other hand, it will strengthen the Jewish majority in the city limits, an important consideration in the face of an Arab population that is growing four times faster than the Jewish one (see panel).

The Al-Quds newspaper called it a "strategy designed to empty the holy city of its Palestinian residents, replacing them with Jewish settlers ... inside and outside Arab Jerusalem." (June 26). And Iranian President Mohammed Khatami proposed an emergency session of the Organisation of the Islamic Conference, to discuss a move Tehran Radio said had "set up waves of outrage and disgust within Muslim countries" (June 24). Further afield, the Clinton administration called the proposal "provocative", and the UN Security Council was expected to issue a condemnation.

Creating facts on the ground

But while international attention is again focused on Israeli actions, the Palestinians are quietly violating their Oslo obligations (Article I and Annex I of Oslo II, September 1995) by reinforcing their foothold in the city they claim as their capital too.

An investigation published in Yediot Ahronot on June 26 found that in virtually every area of administration, from health to education to sport, the PA is providing "services" to Arab residents.

The most serious PA contravention relates to security. Arafat's "policemen" operate quietly in many parts of eastern Jerusalem—and not only there. Recently a re-located "collaborator" (an Arab granted asylum after co-operating with the Israeli authorities) was kidnapped by PA policemen in the southern suburb of Talpiot and taken to Bethlehem. He managed to escape from a police cell there and report the incident to Israeli police.

Meanwhile, Arab construction in Jerusalem continues apace. Despite building restrictions, the number of Arab houses in the capital has doubled since 1967, according to the Jerusalem Institute for Israel Studies. Occasionally, Israeli courts grant orders—much vilified by the media—to demolish new buildings erected without permits, but they only scratch the surface of the illegal building spree underway.

Jews, too, are engaged in the building struggle. One religious group dedicated to restoring Jewish presence in and preserving the historical Jewish character of the Old City, has controversially bought around 40 properties in the "Muslim" and "Christian" quarters of the Old City and supports some 80 families living in these homes. Elsewhere in parts of the city deemed "occupied Arab territory", Jews are buying and moving into houses.

These efforts have been hampered by a government facing increasing foreign pressure to suspend "settlement activities", as well as by the PA's announcement last year that Arabs who sell property to Jews would receive the death sentence. (At least five "suspects" have been murdered since then.) In late June, an Arab Knesset member, Salah Salim, revived the controversy by saying that Arabs who sell land to Jews should be "killed off and made into meatballs".

PM Binyamin Netanyahu has promised to continue building homes for both Jews and Arabs. At the same time, he has made it clear where Israel's priorities lie. Addressing a rally on June 29, he vowed: "We are the landlords here, we are in charge, and we will forever be in charge."

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