Palestine

Palestine
Palestine is under financial embargo: One-quarter of all Palestinian workers were not paid their salaries for the past six months which has caused a situation of widespread, severe poverty.

The Palestinian economy, unlike other economies, lacks national strategic control and a self monitoring system, because it has never been under full Palestinian jurisdiction. The economy has experienced dramatic changes since the Israeli occupation of the West Bank, Gaza Strip and East Jerusalem (the occupied Palestinian territories) in 1967. These changes are always linked to external factors such as employment in the Israeli labor market and the rich Arab Gulf States, and are also subject to the volume of external donations. The repeated closures imposed by the Israeli Authorities on the movement of people and goods have had a negative impact on the economy. Economic factors keep fluctuating. The unemployment rate, for example, has been subjected to wide swings; poverty rates have also moved drastically along with per capita income. This economic instability is mainly connected to the Israeli security and economic measures, which are the chief obstacle faced by Palestinian planning mechanisms.

From 1993 through September 2000, the Palestinian economy steadily improved. Unemployment rates decreased, and income and production increased, thanks to the peace process and external donations. However, in September 2000, the area entered a new era of violence. Since then, Israel has been imposing an extensive closure on Palestinian areas, prohibiting movement of goods and people within the Palestinian territories, between these areas and Israel, and from the only Israeli border crossings to foreign countries. The last 40 months of Israeli closure of the Palestinian territories have inflicted considerable losses to the Palestinian economic activities. From September 2000 until December 2002, Palestinian economic losses were estimated at US$ 5.2 billion. Given that Gross National Income (GNI) amounted to US$ 5.4 billion in 2000, the opportunity cost of the crisis was equal to almost one full year of Palestinian wealth creation, and that in the period of 27 months after the start of the intifada. The Palestinian GNI declined from US$ 5.4 billion in the year 2000 to US$ 3.8 billion in 2002. The large decline in GNI represents both losses in domestic production as well as employment declines in Israel.

To read a detailed labor market analysis for Palestine, download one of the following:
Adobe Acrobat [.pdf] [size 298 kb]
Microsoft Word [.doc] [size 198 kb]

Submitted by:
DWRC – Democracy and Workers’ Rights Center
P.O.Box 876, Ramallah, West Bank, Palestinian Authority
Tel: 972-2-295-2608
Fax: 972-2-295-2985
Email: info@dwrc.org
http://www.dwrc.org/

Update posted September 13, 2006.

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