This document lays out our vision of an independent Palestinian state. It highlights steps we have
already taken to restore good governance and the rule of law to the West Bank - steps we believe
demonstrate our commitment to realizing this vision and steps we aspire to replicate in Gaza. Whilst
the stalled peace process and the tightening grip of the occupation have played a powerful role in
shaping events, we acknowledge we have given insufficient attention to shortcomings in governance,
law and order, and basic service delivery. We are now absolutely determined to rebuild the trust of
our citizens and our international partners in the Palestinian National Authority by embarking on a
challenging reform and development agenda for stabilization and recovery.

We are not complacent about the scale of the task ahead. Progress must be made to upgrade all
Palestinian institutions of government. We intend to create a secure and stable internal environment in
which social and economic development can take place, and in which the institutional infrastructure
of a Palestinian state can develop and thrive. This must go hand in hand with sustained and serious
political dialogue, and concrete steps and commitments by all parties towards a lasting peace. We are committed to bringing safety and security to the West Bank and Gaza. Our immediate goal is to return to the status quo ante before the escalation of conflict in September 2000 by resuming full security control in Area A. Our ultimate goal is to assume full authority and responsibility for security within and at the borders of the future Palestinian state.

Reform and development in Gaza is an integral part of our plan for bringing stability and prosperity
for all Palestinians in the occupied territory. We are committed to restoring the rule of law, good
governance and respect for human rights in Gaza. The illegal seizure of Gaza by Hamas has
precipitated its almost complete closure. Israeli restrictions on the entry of all-but-humanitarian goods
and on the export of goods have led to collapse of the private sector, which represents more than half
the job market in Gaza. We are committed to doing everything in our power to end the closure and
isolation of Gaza and reversing its suffocating effect on society and the private sector. If the isolation
of Gaza continues, we will work to maintain the supply of humanitarian assistance, the continued
payment of public sector salaries and social transfers, and the provision of critical basic services -
including electricity, water and sanitation, and health and education. We will continue to work closely
with UNRWA, other UN agencies and non-governmental organizations providing relief to both
refugee and non-refugee Palestinians in Gaza, to ensure that these needs are met.

Throughout the post-Oslo period, the unstable political environment has undermined our capacity to
develop and sustain effective government institutions and policies. The embargo on international
assistance in 2006 and early 2007 contributed to the reversal of progress that had been made in
reforming the PNA. The ensuing fiscal crisis shattered our citizens’ and public servants’ confidence in
the PNA. This document sets out our broad priorities for improving governance in this challenging
context. It sets out how we will reform the security sector and re-establish the rule of law, improve
access to justice, move toward a more fiscally sustainable position, improve our management of
public finances, strengthen the capacity of the public sector, and improve local governance. We
acknowledge that we have more work to do in defining and calculating the cost of some of these
reforms but this will be tackled in early 2008.

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