A shimmering vision of peace -- or a mirage?

Imagine a strip of blue water flowing 100 miles through the desert, punctuated by artificial waterfalls, surrounded by parks and luxury hotels. It would refill the shrinking Dead Sea, produce hydroelectric power and badly needed drinking water, and bring Israelis and Arabs together in a thriving free-trade zone.

Or, imagine a Middle Eastern white elephant built on an active fault line that irreparably destroys a unique desert ecosystem and the one-of-a-kind salt lake at the lowest point on Earth in the belief that peace and prosperity mean bringing in enough concrete and capital.

It is hard to predict how the proposed artificial waterway from the Red Sea to the Dead Sea, popularly known as the Red-Dead canal, will turn out.

An idea bandied about for decades, the canal has been given a new back wind from one of the world’s richest people: Israeli real estate mogul Yitzhak Tshuva, the owner of New York’s Plaza Hotel. In June, visiting French President Nicolas Sarkozy, one of the plan’s backers, discussed it with one of the project’s leading champions, Israeli President Shimon Peres.

Peres, a Nobel Peace Prize laureate known for thinking big, sees the canal as the main component of what he calls the “Valley of Peace,” a development zone that would provide jobs and wealth to Israelis, Jordanians and Palestinians. If built, it will be the most dramatic single change ever made to the landscape of the Holy Land.

Today, from the scrubby desert and Bedouin encampments of the Jordan Valley, past the dusty Palestinian town of Jericho, through the placid blue mirror of the Dead Sea and on south through the wastelands of the Arava desert, evidence of Peres’ dream is nowhere to be found.

The Dead Sea has been shrinking for years because the Jordan River waters that once replenished it are now pumped for drinking water and agricultural use, and because Israeli and Jordanian factories mining the sea’s valuable minerals have led to massive evaporation.

The dramatic recession of the sea, where salt concentrations are so high that no marine life can survive and humans float effortlessly in the water, has harmed a lucrative tourism industry and caused dangerous sinkholes to gape suddenly along the shores.

Proposals for canals that would channel water from the Mediterranean Sea or the Red Sea have been debated since the 1980s, tickling the imagination before invariably being shelved by economics and other realities.

There is one important difference this time around. In a speech Tshuva gave in May at a conference Peres convened for Israel’s 60th birthday, Tshuva said he and other leading Israeli financiers could foot the entire bill for the canal, desalination plants and hydroelectric installations. He said the cost would be about $3.3 billion, none of which would have to come from public coffers.

The return on the investment would presumably come from selling electricity and water and by developing businesses and tourist sites nearby. In his presentation, Tshuva said the project could create as many as 200,000 hotel rooms and a million jobs.

The vision combines two powerful streams in modern Israeli thinking: American-style private-sector capitalism and old-time Zionist faith in redemption through construction, harking back to the call by David Ben-Gurion, Israel’s first prime minister, for Israelis to move to the desert and make the wilderness bloom.

“The barren desert will flourish, and the arid lands will bloom with greenery on both sides of the border,” said the female narrator of a short movie Tshuva screened at the conference. Simultaneously, computer-generated Israelis and Arabs shook hands and embraced outside an artist’s rendition of sleek hotels on the waterway’s green banks.

Tshuva, ranked 214th on last year’s Forbes list of billionaires, says his next step is to get Israel’s parliament to pass a law that would expedite construction.

Once the bulldozers begin work, he says, he’ll need only two years before the Red Sea waters begin flowing north to the Dead Sea.

Many are skeptical, such as Israeli water expert Shaul Arlosoroff. With the cost of building materials rising, Tshuva’s price estimate is low by about 50%, and hopes of making money from the hydroelectric power and desalinated water may well be unfounded, Arlosoroff said. Without international donations, the project is unlikely to get off the ground, he predicted.

“They are now saying that private-sector money can make this happen, but that remains empty words,” Arlosoroff said.

Jordan, which badly needs the water and electricity, supports the Red-Dead project, but a different version -- one that goes entirely through Jordanian territory. In May, the World Bank began carrying out a $15-million feasibility study of that project, which might involve a pipe rather than an open canal and includes none of Tshuva’s tourism and real estate visions. Researchers expect to finish their work in two years.

The Jordanians seem miffed by the new Israeli plan. Mousa Jamani, director-general of the kingdom’s Jordan Valley Authority, said he didn’t understand the change and believed it violated an agreement signed between Israel, Jordan and the Palestinians.

“The term of reference was signed three years ago that the canal would pass through the Jordanian territories,” he said.

The World Bank referred a query to Noga Blitz of the Israeli water authority, whose director is Israel’s representative to the project. Blitz said the new plan was not affecting the World Bank’s study.

Israeli environmentalists are worried about overdeveloping the Arava wilderness, and the canal’s route along the Syrian-African rift -- a fault line prone to earthquakes. If a quake destroyed the canal, saltwater would flow into the freshwater aquifer underground.

But more than anything, many are worried about the effects on the sea the canal is supposed to save. Mixing Red Sea water with that of the Dead Sea could cause unpredictable chemical reactions that could result in the formation of a white layer of gypsum across the surface, or an explosion of new algae that would dye the Dead Sea red. Because no serious study has been undertaken, no one knows.

“Yitzhak Tshuva is selling us a vision of peace,” said Tzipi Iser-Itzik, executive director of the Israel Union for Environmental Defense, one of six Israeli environmental groups trying to block the plan. “We want peace so much, and we want to save the Dead Sea, but this must be done in an intelligent way. Don’t sell us dreams.”

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Associated Press writer Jamal Halaby in Amman, Jordan, contributed to this report.