We are very proud that due to your help, Al Aqaba Village completed construction of the first three affordable homes in our signature project, Rebuilding to Remain in Palestine. Sadeq and his bride moved-in on the night of their wedding in April. Othman and Sara and their children moved-in just before Ramadan in June. Teachers Nabil and Safa delayed their move to also allow Safa to finish her teaching degree program in Hebron. They hope to move-in soon.
I'm writing now to discuss the direction of this important project.
Our next goal is bold yet simple: Help 10 more families build and move in to affordable homes on the land they own. We want to use the revolving construction loan model Rebuilding Alliance piloted with Al Aqaba's community credit union in building these first three homes. Revolving means that as each family repays its loans to Rebuilding Alliance's office in Ramallah, those funds become available to fund more new home construction. The first three families are already repaying their loans.
Ten is a realizeable construction goal that offers both a big opportunity as well as real challenges. The opportunity is this: last summer, as the families were moving in to their new homes, Rebuilding Alliance was invited to apply for something called Political Risk Insurance. The Managing Director, Insurance and Reinsurance at the Overseas Private Investment Corporation (OPIC) conveyed the invitation. It was surprising because I've been asking OPIC for many years to give us and Al Aqaba this insurance for construction in Area C.
By August, all OPIC applications re. Palestine were put on hold. In January, when I asked them to re-open our application, they were happy to hear from us - but sadly, over the weekend I was informed that Palestinian construction in Area C is still too risky for OPIC to provide us with Political Risk Insurance.
Their questions however opened the possibility of forming a political risk insurance consortium instead of simply relying on OPIC as the sole insurer. I leave for Palestine on March 9th to meet with the Development Finance Institutions (DFI’s) of other some six other countries, and also the World Bank, to explore the possibility of their insuring the Rebuilding to Remain Revolving Construction Loan program that would be administered by Rebuilding Alliance or Al Aqaba Villagers themselves.
Now the details: If we stay with the original plan to qualify Rebuilding Alliance as the loan-maker, Rebuilding Alliance must formally register our branch office in Ramallah and raise a significant reserve as required by the Palestinian Monetary Authority. We'll will have time to reach the reserve requirement — and it will be especially reachable if Rebuilding Alliance secures Political Risk Insurance.
What is Political Risk Insurance (PRI)?
Because Israeli Knesset members openly discuss demolition of Palestinian homes as a way to move them out of Area C, demolitions must now be viewed unabiguously as an act of political violence. As such, one can insure against this (if you are a government with a policy against it). Basically, if countries join our consortium and share the risk, the DFI's would insure our construction for at least 90% of loss due to any political act. So if Rebuilding Alliance has PRI, and if bulldozers threatened to demolish our homes, the consortium governments (and let's hope OPIC joins in downstream) would pay to rebuild them and also seek reparations from the Government of Israel.
PRI could a game-changer for Palestinain families in Area C. This guarantee against demolitions would certainly make it easier for us to raise funds to build the next 10 houses. My challenge in these upcoming discussions is to show why Al Aqaba is a good risk and why the are within their legal and moral rights per the Oslo Accords and International Law to issue their own building permits.
Rebuilding Alliance's request to you:
When you donated to this project, Rebuilding Alliance promised to use your donation for construction -- and we did, succeeding in a remarkable pilot project. Now I ask your permission to use your donation to take the administrative steps necessary to build more affordable homes. In the next few days, I will send you an email asking your permission to use Rebuilding to Remain funds to allow Rebuilding Alliance to seek Political Risk Insurance and also register Rebuilding Alliance in Palestine as a loan-maker so that we can raise funds and build the next 10 homes and more.
There's no guarantee of success but if we succeed, this will be the very first time that Palestinian construction in Area C is guaranteed to remain. Rebuilding Alliance Board Member, Paula Crow esq. is an expert in affordable housing and real estate law. When discussing next steps with OPIC, Paula said, "If Al Aqaba Village does not deserve Political Risk Insurance, I don't know who does." Thank you for supporting Rebuilding to Remain and for believing in Al Aqaba and in us.