AMMAN, Jordan (AFP) — A controversial US plan for Israeli-Palestinian peace could spell the demise of Jordan and turn it into a “Palestinian state,” Jordanians and analysts warn.

The initiative launched by US President Donald Trump’s son-in-law Jared Kushner at a June conference in Bahrain dangles the prospect of $50 billion in investment into a stagnant Palestinian economy.

But it fails to address key issues and demands of the Palestinian side, such as the establishment of an independent Palestinian state, Israel’s occupation in the West Bank, and the Palestinians’ claim of a right to return to homes within Israel from which they fled or were expelled after Israel’s creation in 1948.

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The Palestinian Authority boycotted the Bahrain forum, accusing the unabashedly pro-Israel Trump of using the prospect of cash to try to impose political solutions, and of ignoring the fundamental issue of occupation.

Trump has taken the landmark step of recognizing Jerusalem as Israel’s capital and Kushner has suggested the peace plan may not mention a Palestinian state.

Kushner is returning to the Middle East later this month to push his economic plan, which has been rejected by the Palestinians and criticized by Jordan.

“No economic proposal could replace a political solution that ends the occupation,” Jordan’s foreign ministry spokesman Sufyan al-Qudah said.

Jordan, one of only two Arab countries to have a peace treaty with Israel, sent only a low-level official to the June 25-26 conference in Manama.

In Amman, protests have been staged against what Trump has called the “deal of the century.”

“It would mean the end of the Palestinian cause and it would wipe out Jordanian identity, both in one go,” said Khaled al-Khrisha, a 65-year-old Jordanian, at a rally last month outside the US embassy.

“Jordan will be the biggest loser after the Palestinians.”

Another demonstrator, 81-year-old Widad al-Aruri whose family originates from the West Bank, said the deal “means selling off the Palestinians and is dangerous for Jordan.”

The kingdom hosts millions of Palestinians who poured into the country in two waves, after Israel’s creation and following the 1967 Six Day War, when Israel conquered the West Bank, East Jerusalem and Gaza.

‘Gates of hell’

The largely desert country — which has few resources and relies heavily on international donors, including $1 billion a year from Washington — is home to 9.5 million people, more than half of them of Palestinian origin.

Two-thirds of them are Jordanian citizens, while the others are considered refugees who many Jordanians fear will be settled permanently and given citizenship as well if the Kushner plan goes through.

More than two million Palestinians in Jordan are UN-registered refugees.

“Jordan is worried because the deal ignores the idea of an independent Palestinian state,” said Oraib Rintawi, who runs the Al-Quds Center for Political Studies in Amman.

As a result, he said, “this will mean that the sustainability of a Palestinian nation would be conditioned to it being linked somehow with Jordan and that will open the gates of hell for Jordan.”

And under pressure, Jordan would be forced to take in more Palestinians and eventually give them Jordanian citizenship.

“This is a nightmare,” he added.

Economic challenges

With an unemployment rate of about 18.5 percent, Jordan, whose stability is seen as vital for the volatile Middle East, was last year shaken by widespread economic protests.

In addition to hosting millions of Palestinians, the country has taken in a mass influx of refugees from its conflict-riddled neighbors Syria and Iraq, stretching its cash-strapped economy.

Ahmad Awad, head of the Amman-based Phenix Center for Economics and Informatics Studies, said: “Forfeiting the right of return and compensation (for refugees) will be dangerous for Jordan and the Palestinians.”

He noted that a majority of Jordanians are of Palestinian origin, and a large number of West Bank residents are Jordanian citizens.

Jordan occupied the West Bank, including East Jerusalem, until the 1967 war.

An unofficial agreement with Israel in 1967 left it the custodian of Muslim and Christian holy sites in Jerusalem, whose status is one of the thorniest issues of the decades-long Palestinian-Israeli conflict.

“Jordan has no choice but to reject the (US) plan… and has already rejected it quite firmly (because)… it would turn Jordan into a Palestinian state,” said analyst Kirk Sowell of Utica Risk Services.

Jordan’s King Abdullah II has repeatedly ruled out a confederation with the Palestinians or giving up custodianship of Jerusalem holy sites, calling them “red lines.”