Up until Friday, Israel and the Palestinians have been mired in the cycle of deadly violence for a year, dealing a heavy blow to both sides in terms of peace-making efforts, diplomacy and economy.

The Palestinians, frustrated by an Israeli failure to make significant concessions in the negotiations on Jerusalem, return of refugees, territories and other key issues, rose up against Israeli occupation in a bid to force a compromise.

The Israelis, responding excessively and arrogantly in the position of an occupier, tried to suppress the Palestinian uprising by resorting to advanced weapons. But they found that more Palestinians stood up to them after hundreds of Palestinians were killed.

In the end, neither side has gained its goals but suffered heavy losses in various fields.

On the peace-making front, Israel lost a chance to reach reconciliation earlier with the Palestinians, and then the whole Arab world, while the Palestinians lost a chance to establish an independent state in 2000 under signed agreements.

The clashes have also pushed more Israelis and Palestinians into extreme wings, and jeopardized peace camps, thus dampening chances to re-start the final-status talks in the foreseeable future.

According to the Peace Index survey, conducted since 1994 by the Tami Steinmetz Centre for Peace Research in Israel's Tel Aviv University, the Israelis' attitude toward the Oslo peace accord fell significantly to 30.4 last August from 45.3 last year.

The trend was revealed in Israel's prime ministerial election in February, in which hawkish challenger Ariel Sharon trounced left-wing incumbent prime minister Ehud Barak by the largest margin in Israel's election history.

Though Ehud Barak's Labour Party later joined the national unity government, the coalition has been dominated by the right-wing parties, such as the Likud led by Sharon, Shas, the National Union-Yisrael Beiteinu, and Yisrael Ba'aliya.

Moreover, Israeli Defence Minister Binyamin Ben Eliezer, a Labour Party member, represents the right wing of the dovish party.

Meanwhile, Israel's eye-for-eye military policy and tight closure on Palestinian territories did not succeed in forcing the Palestinians to give in. Instead, the policies irritated them and sowed the seed of hatred in the hearts of the Palestinians.

According to a survey published by the Palestinians' Jerusalem Media and Communications Centre last Tuesday, only 29.2 per cent of Palestinian interviewees support the Oslo accord, which was signed in 1993.

In addition, 48.5 per cent of the interviewees said that the goal of the current intifada, or popular uprising, was "the liberation of all Palestine," including Israel, the West Bank and Gaza Strip.

This public opinion has weakened the moderate wing of the Palestinian leadership, such as the camp formed by Palestinian Legislative Council Speaker Ahmed Qurei and Mohmoud Abbas, secretary general of the Palestine Liberation Organization's Executive Committee.

Meanwhile, radical leaders, including Marwan Barghouti, head of the Palestinian mainstream Fatah movement in the West Bank, and radical groups, such as the Islamic Resistance Movement (Hamas) and the Islamic Jihad (Holy War), have become more and more popular.

Due to the Israeli closure that cut the Palestinian areas, some local Palestinian leaders have become more independent and publicly defied Palestinian leader Yasser Arafat's ceasefire order, casting a shadow over future peace talks.

On the diplomatic front, both sides, especially Israel, have also lost scores.

Due to the conflict, lukewarm relations between Israel and Arab neighbours deteriorated further: the countries which want to develop relations with the Jewish state abandoned such an idea, those which have unofficial relations with Israel closed their interest offices, and Egypt and Jordan, which have diplomatic relations with Israel, recalled their ambassadors and still refrain from sending them back.

The sufferings of the Palestinians under Israeli occupation were broadcast worldwide, bringing about stern condemnation of Israel and sympathy for the Palestinians.

This was seen at the World Conference Against Racism in South Africa earlier this month.

In terms of the international mediation efforts, the European Union has adopted an even more balanced and just policy than the United States.

Even the US, the most ardent supporter of Israel, has shown some impatience and unease towards Israel's bully policy against the Palestinians. US officials have even demanded that Israel stop using American-made fighter jets against the Palestinians.

For the Palestinians, their suicide bombing attacks hurt innocent civilians in Israel and thereby were not favoured by the international community.

Turning to the economic front, both sides have suffered enormous losses.

According to statistics released by Israel's Finance Ministry last Tuesday, its gross domestic product (GDP) will grow by only 0.5-1 per cent in 2001, far less than the estimated 4 per cent.

Finance Ministry expert Michael Sarel said the violence has eaten into at least two percentage points of GDP growth, amounting to (US$2.4 billion). Furthermore, the forecast of Israel's GDP growth in 2002 has been downgraded from 4 per cent to 2-2.5 per cent.

This year would be the worst for Israel's tourism industry in a decade, with a reduction of about 50 per cent in the number of tourists in the first six months from the same period last year. Economic losses from the tourism industry already amounted to US$1.2 billion.

Meanwhile, construction and agriculture are also in the red because they could never hire those low-salary Palestinian workers and farmers, who are barred from entering Israel.

For the Palestinians, the clashes brought about even more economic losses. According to Palestinian sources, the one-year-old clashes have so far resulted in an economic loss of at least US$5.4 billion.

About 300,000 Palestinians lost their jobs in Israel and the unemployment rate in most Palestinian cities rocketed to 50 per cent.

The Israeli army has also chopped down thousands of fruit trees, damaged Palestinian crops, and demolished Palestinian homes to ensure the safety of Jewish settlers.

According to Peter Hansen, commissioner general of the United Nations Relief and Works Agency (UNRWA) for Palestine Refugees in the Near East, more than half of the Palestinians in the West Bank and Gaza Strip will live below the poverty line by the end of this year.

Palestinian experts estimated that even if the clashes stopped now, the Palestinians would at least need three years to restore the economic situation to normal.

Therefore, only a lose-lose situation has arisen as a result of the clashes.

Neither the Israelis nor the Palestinians have gained enough to balance their losses, so it is imperative for both sides to end the violence and return to the negotiating table.

On Wednesday, Israeli Foreign Minister Shimon Peres and Arafat reached an agreement on sustaining a ceasefire on the ground, a glimmer of hope that the two sides have finally become sick of the heavy losses.

However, as experience has proved in the year-old violence, it is doubtful whether the ceasefire will hold for a long time, or even if it is successful, and whether the two sides could return to negotiations and finally settle their differences.

As former US Ambassador to Israel Martin Indyk once said, the two sides "have been condemned to live together" and only a peaceful solution can eradicate the roots of violence.

(Xinhua News Agency 09/29/2001)