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The Holocaust museum

On 19 August 2003, Shelly Levine, one of Israel鈥檚 foremost developers, was driving through Jerusalem鈥檚 Shmuel Hanavi neighbourhood. Ahead of her was a No 2 bus, packed with worshippers returning from prayers at the Western Wall. Levine moved past as it turned left, but was no more than 20 m away when the bus blew up. The blast left 23 dead. Although she suffered no more than a cracked windscreen, she is unable to forget the carnage wrought by the Palestinian suicide bomber.

Such is the gruesome background to life in Israel; Palestinians living in the Occupied Territories have their own horror stories of everyday life during the four years of the second intifada. For people in the construction business, such as Levine, every building site has a political dimension. This is especially so when the development happens to cross the Green Line that separates Israel and the West Bank. Levine鈥檚 firm, Tivuch Shelly, carries out work in the border settlements. 鈥満蒙�先生TV in Israel is totally political,鈥� she says. 鈥淏ut nobody does anything purely on ideological grounds.鈥�

Nobody knows better how supremely political the act of building in Israel is than the prime minister Ariel Sharon. He has been a passionate supporter of the settlers鈥� movement, and from 1990 to 1992, as minister of housing, he led a settlement drive in the West Bank that resulted in thousands of Jewish settlers moving in.

It seems ironic, then, that it is Sharon who has recently forced through a policy of pulling Israeli settlers out of the Gaza Strip. The move has been bitterly opposed within his own party and by parts of his coalition government. Some see the unilateral withdrawal from the Gaza, home to 7000 settlers and 1.3 million Palestinians, as a pragmatic necessity; some see it as a way of postponing the day when Arabs outnumber Jews in Israel and the Occupied Territories, currently due to dawn in 2020. Others argue that it is a quid pro quo for staying on in the West Bank. It鈥檚 no coincidence, they say, that Sharon has just issued a tender for the construction of 550 flats in Ma鈥檃leh Adumim, a 30-year-old settlement north-east of Jerusalem and beyond the Green Line.

The scale of Ma鈥檃leh Adumim may be small, but it is of international significance. According to president George Bush鈥檚 stalled 鈥淩oadmap for Peace鈥�, new settlements in the West Bank should not go beyond 鈥渢he existing construction line鈥�. Israeli government spokesmen are therefore keen to deny that Israel is building more settlements in the West Bank.

Their denials rely on the fact that the no building rule can be bent to allow 鈥渘atural expansion鈥� 鈥� that is, growth in the number of original settlers. And, of course, no Israeli government can be seen to ignore the views of settlers. From Levine鈥檚 point of view, there is no controversy about expanding Ma鈥檃leh Adumim. 鈥淎fter the Camp David peace talks [in 2000] I spoke to an Israeli politician involved in the negotiations and he said Ma鈥檃leh Adumim was non-negotiable. Nobody considers it to be over the Green Line.鈥�

The town, just 10 minutes鈥� drive from Jerusalem, has a population of 35,000. According to Levine, it could grow to 100,000 by 2020. She insists that this is because of the market, not just politics.

鈥淚t鈥檚 impossible to sell houses in the West Bank settlements,鈥� she says. 鈥淏ut the places surrounding Jerusalem will be okay. This is a beautiful city with great quality of life.鈥�

But from the Palestinian point of view, the expansion of Ma鈥檃leh Adumim is less good news. Aziz Abu Tair is the head of AAT, a contractor he set up after returning in 1996 after spending 16 years in the UK. He is a civil engineer and does a lot of work in west Jerusalem, but has also worked in the West Bank.

Aziz says that many Arab contractors work in places beyond the Green Line like Ma鈥檃leh Adumim, but he refrains out of principle. 鈥淭he effect of these areas is to limit Arab growth in east Jerusalem,鈥� he says. 鈥淭he process takes Arab land and builds Jewish houses on it.鈥�

East Jerusalem is surrounded by a collar of Israeli new towns 鈥� to the north-east by Ma鈥檃leh Adumim and to the south by the growing town of Har Homa.

The main problem about working elsewhere in the West Bank is payment. 鈥淪ometimes it takes a couple of months after you apply,鈥� he says. 鈥淚t鈥檚 because most of the projects are paid for by overseas donations. In Israel you almost always get paid within a month.鈥�

Since 2002, the height of the second intifada, West Bank Arabs have not been allowed to work in Israel. This has led to a glut of workers. Those employed by Aziz come exclusively from Jerusalem, a situation he finds farcical. 鈥淧eople used to come and go,鈥� he says. 鈥淣ow there are hard penalties on contractors who employ illegal workers. It can be a very large fine 鈥� even imprisonment.鈥�

Aziz is most scathing of the 拢1.34bn 鈥渟ecurity fence鈥� being built around the West Bank. This is highly popular among Israelis of all political colours, but Aziz says it is mad. When you consider his family鈥檚 experience of the wall, you see his point. His brother lives to the south of Jerusalem. The barrier goes through his town, neatly bisecting it. The first thing he knew about it was when the tractors turned up to start work. 鈥淲e鈥檇 read about it in the papers,鈥� says Aziz, 鈥渂ut we never knew where it was going to be. We鈥檝e challenged it and managed to get a freeze until next month. I don鈥檛 know how they can put the fence around Ma鈥檃leh Adumim,鈥� he adds. 鈥淚t鈥檒l create this huge bulge out of Jerusalem.鈥�

Yet the politics of the peace process is never far away. If Ma鈥檃leh Adumim does grow, it will be because the Israeli government wants it to, since it owns 98% of the land in Israel and tightly controls the tendering process down to size and type of dwellings. And any government consent to build housing is inherently political because, as the border towns expand, they will no longer be considered to be beyond the Green Line. Put simply, it will be harder to argue that places like Ma鈥檃leh Adumim should be left out of any new Israeli state if they become bigger and have more Israelis in them. Levine says: 鈥淭he bottom line about Ma鈥檃leh Adumim is that it鈥檚 an artificial border that represents the future border of the north-east of Jerusalem.鈥�

The policy received a huge boost on 14 April with Bush鈥檚 endorsement of Israeli control over major Jewish residential areas in the territories. The economic outlook is likely to be a continued growth in workload for Tivuch Shelly.

• 好色先生TV would like to thank Media Line for their assistance with this article