Thank you all for being here, for our usual meeting of the Ad Hoc Liaison Committee at the UN General Assembly’s week, taking place here like the Spring meeting does in Brussels.

It is my last meeting before the end of my mandate, so it's only natural for me to look back. My very first visit at the start of my mandate was to the Middle East, and I said at the time a two-state solution would have been possible to achieve during my mandate. Unless something happens in the next five weeks, which I would of course welcome, this has not happened, but I continue to be convinced that a solution based on two States is still possible, and around this table we know what would be needed to achieve it.

I am proud that we, Europeans, have never lost our compass. We have always kept working to preserve and enable a negotiated two-state solution for Israel and Palestine. This is a principled and pragmatic position. It is about justice and about realism.

The two-state solution is about democracy: it is the only realistic way to ensure that both the Israelis and the Palestinians can fulfil their national aspirations to self-determination and sovereignty.

The two-state solution is about peace and security, for both Israelis and Palestinians. And the two-state solution is also about economic growth. A Palestinian State is essential to build a more autonomous Palestinian economy and, at the same time, greater integration with the rest of the region. There can be no sustainable development for Palestinians without statehood and development of Palestinian economy will be beneficial for the whole region.

Clearly, the space for such a solution is shrinking rapidly, because of political choices that have been made, because of the situation on the ground and also because of the growing sense of hopelessness among Palestinians and Israelis. But I still firmly believe that with courageous leadership, a return to negotiations is possible and continues to offer the only pathway to lasting peace and security.

In these five years, there have been moments of hope and moments of crisis, more crisis than hope. Even in the darkest moments, our compass has always been to preserve the possibility of a two-state solution. To prevent the collapse of Oslo’s dream, and create the conditions for better times to come.

We cannot impose a solution on the parties. It is up to the Israelis and the Palestinians to reach an agreement. What we can do, is to try and preserve the viability of the two States, and remind everyone that any peace plan will ultimately fail if it is not firmly anchored in international law, and if there is no ownership on the ground.

In this context, let me say once again that we expect both parties to act in accordance with international law, and that border changes can only be decided through direct negotiations between the parties, based on the pre-1967 borders.

The work of the Ad Hoc Liaison Committee is part of this broader engagement, to preserve the viability of the two States. Let me thank once again our Norwegian friends for the amazing cooperation of these years. We believe in the importance of this Committee because we believe in the two-state perspective. We also firmly believe that creating alternative or parallel structures should be avoided.

I want to make three brief points regarding some of the specific items under discussion today:

Firstly, on the fiscal crisis, the EU expects the economic and fiscal agreements between Israel and the Palestinian Authority to be implemented in full, including Israel's obligations under the Paris Protocol. A functioning Palestinian Authority that delivers health, education and security is in the interests of both parties. We urge both parties to work together to find structured solutions that preserve the spirit and the substance of the Oslo accords. So the recent arrangement found on the fuel tax issue represents a positive step. Yet, more structured arrangements on fiscal matters still need to be found, based on the full implementation of the Paris Protocol.

Secondly, on the health system in Gaza, I would encourage all parties to work to improve the governance of the system as well as to increase the transparency of the supply chain for drug delivery. The EU supports the proposed UN logistics system for the delivery of medical supplies into Gaza.

Thirdly, the situation in Gaza clearly requires sustainable solutions, in particular investment in the water and energy sectors to promote development and the needs of the population. The Gaza Central Desalination Plant project is essential for the people of Gaza and we are glad that it is advancing, with the strong support of both the Palestinian Authority and Israel. Financing has been secured but the door remains open to other donors to participate. The European Union counts on broad support to keep moving ahead with this project and in parallel to advance on the Gas for Gaza initiative.

These may sound like relatively technical issues. But the Ad Hoc Liaison Committee is not about technicalities. It is essential part of the architecture created in Oslo, to pave the way towards the two-state solution. Funding and economic development are essential, but cannot provide a lasting solution on their own.

What Palestinians and Israelis need is a political perspective – and the only perspective that can ensure peace, security, democracy and sustainable development is the two-state solution.

The European Union has consistently been the largest donor to the Palestinian people. Our support is aimed at preserving and facilitating the prospect of a Palestinian state living alongside the State of Israel in peace and security. Should this prospect disappear or no longer appear achievable at all, the European Union and other donors would need to fundamentally review our support.

But I remain an optimist. The two-state solution is in danger, but it is still possible. Ultimately, it is first and foremost a matter of political will from the two sides and their international partners. We need to preserve and protect the Oslo process and the two-state solution.

Thank you.