São Paulo – The United Nations Conference on Trade and Development (Unctad) disclosed on Tuesday (23) a report showing that the economy of the Palestinian territories occupied by Israel grew 9.3% in 2010, but that there was no reduction of the bottlenecks that stunt the sustainable development of the region.
The study shows that the Gross Domestic Product (GDP) of Palestine had grown 7.4% in 2009. However, the unemployment rate remained at 30% last year and the year before. “The growth recorded in 2010 is not a sign of sustainable recovery but rather reflects an economy rebounding from a low [comparison] base,” says the study.
According to the Unctad, the growth observed in recent years did not alter the bad long-term development perspectives. That is because the Palestinians are still losing land and natural resources, are still isolated from the international community as well as being divided both physically and politically.
“Unemployment, poverty and food insecurity, especially in Gaza, continue to be alarming,” says the report. The Unctad blames the Israeli blockade for the situation. “Against the background of the sharp economic decline experienced since 2000, the continuing Israeli closure policy and confiscation of Palestinian land and natural resources raise concerns about the sustainability of the growth experienced in 2010, and the development prospects of the Palestinian economy”, the report adds.
In the tax area, the study shows that two thirds of revenues of the Palestinian National Authority (PNA) come from transfers controlled by Israel and, thus, are subject to the instability of political moods. Furthermore, Israeli bankers restrict foreign trade of Palestine and make it more expensive, which represents a significant problem, due to the small scale of the local market.
“Steady access to global markets at normal cost is not only of critical importance to Palestinian economic development, it is actually a precondition for such development to take place”, points out the study. “The small size of the [occupied Palestinian territories] market implies that improvements in living standards cannot be achieved without building a dynamic, high-value-added export sector,” it adds.
Palestinian exports, according to the Unctad, dropped from US$ 960 million in 2008 to US$ 919 million in 2009, only to rise to US$ 992 million in 2010. On the other lane, imports totalled US$ 4.4 billion in 2009 and US$ 5 billion last year, or 65% of GDP.
Some 90% of exports go to Israel and 80% of imports come from there. Of all the Israelis ship to the Palestinian territories, just 42% is made up of legitimately Israeli products; the remaining 58% is transhipment of products from other countries. With this, the PNA also loses out on important customs fees.
The sector most affected by the blockade is industry, which had 6% retraction in 2010, whereas hotels and restaurants, building, public administration and architecture grew 46%, 36%, 6% and 22%, respectively. In the case of agriculture, the report points out that expansion last year took place after continued decline over a decade.
According to the Unctad, if productivity of the economy of the region had continued at the same levels after the Oslo agreements, in 1994, the GDP of Palestine would currently be 88% greater. The report shows that 26% of the Palestinian population lives below the poverty line, whereas in Gaza the total is 38%. The West Bank indices are the most positive.
Food insecurity is faced by 50% of homes in the Palestinian territories, according to the study and in Gaza the percentage is as high as 65%. This is due to the fact that in that region, farmers are not allowed access to 33% of arable land, while fishermen cannot go into 85% of territorial waters.
At the UN
The Unctad document was released while the Ministerial Committee on Arab Peace Initiative, established by the Arab League, met in Doha, Qatar, to discuss Israeli occupation, among other topics.
According to Qatar News Agency, the committee reiterated the engagement for recognition of the Palestinian State at the United Nations (UN). The PNA plans to present the proposal at the next UN Assembly General meeting, in September. The secretary general at the League, Nabil Al-Arabi, is in charge of continuing in the search for international support.
The event included participants from Qatar, Egypt, Saudi Arabia, Algeria, Lebanon, the United Arab Emirates, Bahrain, Syria, Jordan, Tunisia, Morocco, Oman and Sudan, as well as PNA president Mahmoud Abbas.
*Translated by Mark Ament
