Blog- WSJ : It’s been more than half a year since U.S. Secretary of State John Kerry announced an ambitious economic plan to channel $4

billion into Palestinian business sectors ranging from agriculture to telecommunications by 2016.

But at a conference of the Palestine Information Technology Association on Sunday, businessmen said that the potential for realizing the promised investments was as hazy as the sandstorm that enveloped the gathering at Jericho’s Intercontinental Hotel.

Though Mr. Kerry and the “Quartet’’ of international peace process sponsors say the Palestinian Economic Initiative would run in parallel to peace talks, businessmen here say they’ve seen little actual progress or signs of interest from foreign investors.

That said, few seem ready to give up on the plan completely. Some Palestinian businessmen say that recent gains on the stock exchange reflect optimism about U.S. led peace process.

The assumption is that the economic initiative – which targets agriculture, construction, tourism, IT, manufacturing, and energy businesses – will be closely linked to the progress of peace negotiations and conditions on the ground in the West Bank.

Acceptance of a U.S. “framework’’ for further talks would be a good sign, but Israeli security forces need to relax limitations on Palestinian movement and ease access to shipments of Palestinian goods.

“Palestinians are skeptical about what is going to happen,’’ said one senior Palestinian banking executive, who couldn’t give his name because he was not authorized to speak publicly.

That said, Western officials have begun discussions on implementing the plan with Palestinian businessmen in the West Bank and a conference is scheduled for next week in Prague on the peace initiative, bolstering some hope, the official said.

“Massive direct investment depends on the political level. No one is coming to us now, because nothing is solid. If there would be a huge development in negotiations, there would be a huge need for financing.’’

If there’s one nagging reminder for Palestinian information technology professionals about the tenuous state of the Kerry economic initiative, it’s the persistent refusal by Israel to give Palestinian network providers access to 3G network frequencies despite a recommendation by the Quartet that such a move is necessary to boost the fledgling IT industry – which currently accounts for 6.1 percent of the Palestinian economy.

“Tony Blair has been talking about all sorts of things…but they never give him anything,’’ said Mashhour Abudaka, the executive director of the IT association and a former Palestinian communications minister. “They’re not going to give us new frequencies. We are entitled to our natural resources, but they tell us, ` use our network’. But no frequencies.’’

The 3G dispute highlights another dimension of how Palestinians see economic progress held up by Israel, which retains control over access points from roads, borders, to international telecom gateways. Israel has said that it has no more frequencies to spare because they are earmarked for the military. The Palestinians allege the motive is economic rather than security: It allows the Israeli government to boost their own network providers, who attract Palestinian users by providing partial 3G coverage in Palestinian areas.

For all the lack of enthusiasm regarding the Kerry economic initiative, one Palestinian telecommunications executive conceded that the U.S. has prompted the Israelis to relax restrictions on Gaza to allow equipment for a second wireless network provider there, Osama Qawasma, from Wataniyeh Mobile.

The move marks an incremental step, because Israel blocks Wataniyeh from expanding its mobile service to Gaza. Mr. Qawasme remains upbeat going forward, citing the $400 million investment by Wataniyeh’s controlling shareholder in the Palestinian IT sector as evidence of a vote of confidence in Palestinian IT. That said, like many Palestinians, he remains beholden to Israeli access restrictions. “If Israel In 2014 won’t accept giving us 3G frequencies, what will they say about Jerusalem’’ in peace negotiations.