Naftali Bennett - Minister for Economy, Israel HARDtalk

he was gay in a magazine interview last April. That is it for me, and

now it is time for Hard Talk. Welcome to Hard Talk, I am Stephen

Sackur. How stable and sustainable is Israel's government? It relies on

a right-wing Zionist parts are supportive of the secular movement.

What happens to that coalition as the Americans tried to push Israel

towards a land-for peace deal with the Palestinians? Is the Israeli

Right about to splinter? Naftali Bennett, welcome. Great to

be here. Are you comfortable to be a part of a government that is

petitioning for a 2-part peace deal with the Palestinians? It is a

complicated situation. When I joined I said I realise what his goal is,

and I do not want to bother him. He can go ahead and seek an

arrangement. I will respect the results, no matter what they are.

Those are the frameworks while we differ on opinion. That sounds like

a great gentleman 's agreement but it appears you have broken it. You

shared these, our forefathers and descendants will not forgive an

Israeli leader who gives up land and divides Palestinians. That is

correct. It has been our home for 500 years and I think it would be a

grave mistake to divide our country. We have tried this approach

for the last 20 years, and it has not worked. We are bashing our heads

together again because every time we broke for a piece of land, it

results in missiles being launched on us. We did it in Gaza or three

times already. We handed land over to the Arabs and within days they

started shooting missiles at us. It is clearly not work in. I want to

get into your position soon, but what about your relationship with

your boss? You told me at the beginning of the interview you told

him you wouldn't bother him, but you are. You said you would not forgive

him and you were accusing him of potentially betraying the nation. I

am not accusing anyone of betrayal. His office was so furious that it

amounted an immediate apology. I am happy that it is a democracy and we

can debate things within the government. While we are a

coalition, we still have disagreements. There is a large

number of Israelis who think it is a profound mistake to hand more land

over and hopefully this time it will bring about peace. Do you apologise

for essentially, coming back to that word, accusing the Prime Minister of

betrayal? No. He said he will sack you if you do not apologise. So

either he backed down or you do. You are referring to a different

statement regarding misleading Israelis, and I said that notion is

a bad idea. I think it was part of the same speech. He said this was

part of a 2-part solution. Jewish settlers could remain under

Palestinian sovereignty. The problem is history has taught us that every

time Jews live under Arab sovereignty, they were butchered.

This was the man you promised that she wouldn't intervene with. You

said you would leave it alone. It is about the balance of power within

the Israeli government. Either you back down or he backs down. Which

was at? When I said I wouldn't allow the peace talks to happen, we are.

We are allowing them to happen. I said, go into the room, take as much

time as you need whether it is six days, weeks or years. Bring the

deal, but they haven't. That does not mean I have to be mute about my

opinions, I will speak up. That is one of our problems, but we haven't

spoken up about the truth until now. But you can't just say I will speak

up and let the process play out. You have seriously breach inside the

government. We believe, according to sources of the United States, that

John Kerry may be looking for a restriction settlement from Israel

as part of the frameworks to move this peace process forward. Would

you support a construction freeze? I think stopping anyone from living

our land is a mistake. By the way, nobody is asking the Palestinians to

freeze their building. If it were mutual, but would be another thing.

Will you support and accept the concept of a construction freeze as

part of John Kerry is a framework as part of moves in this peace process

forward. Of course not. So it would be a dealbreaker... No

demonstrations on the street. You can walk around Israel, everybody is

leading their lives. If you want more time take more time. The

Palestinians do not recognise Israel as the Jewish state. They used to

say there were two states the two peoples. They don't say that any

more, it is just two states. They want separate states for

Palestinians and Israel. They are not willing to accept it, so why

should we? He has said it is not an issue. We have recognised Israel.

Recognising the Jewish nature of the state of Israel is different, said

Mr Arik. 1.5 million Palestinians that live inside Israel that are not

Jewish... What will happen to their descendants. Some of them think they

should be allowed back to their ancestors home within your country.

That is unfinished business. That is exactly the point. He is saying to

divide the land and give us half. Now let's start debating your half

and make it into a bilateral state. There are 300 times the size of our

tiny state. From the ocean to the Green line, it is a ten minute ride.

That is how narrow our state is. But he wants a piece of that. He needs

to recognise Israel as a Jewish state. The Jewish nation only has

one state in the whole world, and that is Israel. If he wants it to be

a multinational state, he wants his states and the day we find that a

deal he will be fighting for the small Jewish State. Isn't a

fundamental as he at the heart of your argument is that you will never

accept a two states nation because all of the lands belongs to a

Israel. It stars. This land has been out for thousands of years.

Yesterday I gave a coin to Martin Schultz as a gift, it was 2000 years

old. America has been in American land and even British in British

land. I recognise that Palestinians have aspirations and they are not

going anywhere, but neither are we. We have to learn to live together.

Why don't you give them sovereignty? Because everytime we

did they kill us. Would you hand over half of Britain to somebody who

keeps killing you. So your sort -- solution is to have Palestinians

living in the West Bank permanently stateless? When I was a businessman

we tried distraction. Again and again, in 1995. They were willing to

give them something, and in response they killed Israelis. It is not

working. I want to try a different approach. When something doesn't

work, bring in a new guy mentioned. It is not working. I am a rational

person. When I see something not working, I try something else. But

something else is peace between the people. I am to building day in and

day out businesses to bridge Palestinians and Israelis together.

You have not been there for a while, but there are more and more

businesses and economy, and that is the real bridge to peace. Clearly

the diplomats are failing. I have been there are very recently. I

don't live there any more... I offer you a personal tour. You have to see

what is going on. It is good. I wonder if you have any idea what is

going on in Palestinians heads and hearts. Because when you told me it

is beautiful and that Palestinians are going to accept this idea that

they will live stateless, that is delusional. It will never happen.

What you don't understand is to be killed again and again when you hand

over land. What would you do is everytime you hand over land to the

Arabs, from that location they shoot missiles at your home? Would you do

it again? Address this question from an influential, prominent... Anti-

Israeli. He said to refuse a 2-stage deal you have to believe that the

Palestinians will ultimately embrace their disenfranchisement, and that

is the real naivete. The difference between he and I is that I have

fought in every battle since 1990. And you have lost children and

family? I have. It is my kids who will need to pay the price for

naivete. 1000 people blew up in Tel Aviv when we did hand over land. Now

I have to fight back and recapture it. You seem to be ignoring that by

asking this question. I don't ignore the suffering and loss on both

sides. What you are ignoring... Look at the Palestinians experienced

since 1998. I think about some of the things you have said in the

past, and in 2010 you said is, you were still climbing in trees when we

had a state. When you are talk about the Palestinians, to you have any

empathy? I have empathy. He said that they were here before us but we

went here before them. Palestinians listen to that language and they

feel politicians... You can focus again and again on that term or the

reality. We have a tiny home, one home for the Jews. There are Arabs

that has 22 states that are much bigger. That is all we have got,

that is what we have had the ever. One democracy in the middle east. We

have the Supreme Court, freedom all speech. He is a member of our

parliament, an Arab Israeli. Show me in Jordan or serial one Jewish

Member of Parliament. We are the only democracy who gives free rides

on equal rights to women, anyone can speak up in Israel and everyone

does. The reality is you and your ideology are out of step with your

prime minister, Manu Tuilagi, and Tzipi Livni, -- with your prime

minister Benjamin Netanyahu. You are out of step with international

community and the Obama Administration. As a result of being

out of step with those people, you're ready to contemplate

Israel's diplomatic and economic isolation. You ready it that? It is

quite the contrary. The fact a lot of people think something, does not

make it right. History teaches us common wisdom is correct 50% of the

titles. To hand over land to my enemy and hope that somehow... We

have gone through... We have rehearsed... However... You are

talking about the entire world. Let me tell you you I do have, the

Israeli public. The younger generation is flocking to my party

because they look at reality not from Washington, DC, not from

London, but from the ground up and we see reality. The Israeli people

are willing again and again to have a peace but we got terrorists. We

have to look at reality. There are other ways but, no, everyone is

insisting to bash ahead and create a third in the TADA stop it you want

to be internationally isolated and want war, set up at a hostile state.

I am not talking about bashing heads, and took about people outside

of Israel looking at the policies of the Israeli government and deciding

they got to pursue a policy which might include divestments, might

include at some point, sanctions, some are talking about boycotts.

There are many Israelis, including business leaders who have met with

your prime minister, Benjamin Netanyahu, and said that they must

make peace with Palestine because we cannot afford not to. Yes, I would

ask those business people how would Israel was the economy look first

time a plane is shot down from the West bank? How will our economy and

tourism be when we get to measles a day into Tel Aviv, not the tender

measles we get now. I understand their desire for peace. -- missiles.

But we have to face reality. We live in a real place. Not Lala land.

Anyone who thinks of the investing or boycotting Israel, that is

outrageous. We have a partake going on in Lebanon and Syria. In this

area they butchered an hundred thousand people. In Iran, you are

killed if you protest. In Israel, is the only place of freedom - that is

where you are going to boycott explanation might interesting you

introduced apartheid. It reminds people of South Africa and the

sanction campaign against the apartheid regime there. A senior

industrial, an important Israeli company, says it is reminiscent of

South Africa in the 1970s and we need to learn the lesson of what

happened that not these things start small but they quickly gather

momentum. The reality is, and your business leaders are telling you,

Minister of economy, that Israel cannot afford to be economically

isolated. We are not economically isolated. The fourth quarter of 2013

was the best quarter. We sold the company for $9 billion. I do not buy

all that talk about... It is not talk, with all due respect, are you

aware that the Netherlands's biggest pension fund has a ready backed out

of investment in five Israeli banks? You are where the EU has a reading

poster banned on grants and loans to institutions that have operations in

the West Bank - you know all this. If someone does not want to invest

beyond the green light, so be it. Really there is a debate of the land

is disputed. There are different opinions to my own. I cannot tell

the European country what to do that rocketed. -- their prerogative. But

it would be self-defeating. The regatta system is Israeli, the

navigation system is the Israeli. One of your ministers says the

economy is much more vulnerable than secure. Yesterday I was at a summit

at the EU of economy ministers from around the world. Everyone wants to

see how we built another start-up nation. How we get this unique

innovation that we have in Israel and we are helping out in India,

Africa, all around the world. We are doing amazing things. The way to

growing economies to continue innovating, creating jobs around the

world. You can turn it to people from different industries, high-tech

companies, they say that the tech sector does not make us in Israel

invulnerable. The software sector can be here. It is it for companies

to move across borders. The people at the top of business in your

country are now getting worried. That is very interesting because

just over the past year, Google set up shop in Israel, Microsoft,

Facebook, has set up shop. His fellow small centres than anywhere

around the world. But they do not have to stay. They are in a

country... The whole problem with your approach, Stephen, is that it

has nothing to do with reality, beyond that is perfect. We are

getting more foreign investment into Israel because people appreciate our

economy and respect how being the only democracy in the middle east.

That forget that the one moment not shabby any other country that treats

its minority the way we do. We are not blowing up mosques like others

are blowing up churches. We respect everyone. I know it is hard to you

to recognise but we are a free country. Two point want to put to

you quickly. One is with the US. You can deeply about the US. Your

parents came from the US to Israel. Would you accept that relations

between the US government and Israel are at the lowest air. They are

poisonous. Not at all. America is our biggest ally. We have the

intelligence and economic relationships. It is our number one

trade partner. From Robert Gates has made recent book... We have recent

disagreements. But that is a cave. America is a good friend, as is

Britain. A good friend? Have you read Robert Gates? I can read one

opinion and I can read another. Your job is to pinpoint what certain

people think and I am telling you that I see more and American

investment coming into is shot, more American intelligence collaboration

with us and, yes, we have disagreements on the Palestinian and

Iranian industry but friends can disagree. We have to leave it there.

Thank you to being on HARDtalk. It was a pleasure, thank you.

It has been a weekend of contrasts. Some places are dry. Others, a huge

amount of rainfall, especially in western Scotland. The weather front

responsible for that is slowly weakening. But it is still there

first thing in the morning. A narrow band of rain is straddling the heart

of the UK. Dry on either side. Some sharp bursts of rain in the morning

across parts of the West Country and up into Wales. To the west of