The Call Is Palestinian, But the Decision Is Israeli!

By Nadia Hassan

Palestine Think Tank, May 29, 2008

The 60 years of Israeli Occupation of Palestine and other areas of the Arab Homeland puts constant pressure in a direct way upon the daily lives of the Palestinian people. Walls and fences, checkpoints and block roads, closure and siege are just some of the elements that exert devastating effect on the Palestinian economy. The major cause of the Palestinian economic crisis is closure ― the imposition by the Government of Israel of restrictions on the movement of Palestinian people and goods across borders and within the West Bank and the Gaza Strip, territory that Palestinians have “nominal” control over.
 
According to the UN Conference on Trade and Development, as much as $2.4 billion in United States currency has drained out of the economy of the West Bank and the Gaza Strip thanks to closures, mass unemployment, and the flattening and destruction of most infrastructure by Israeli tanks and helicopters.
 
The report said that the damage is so extensive that it could prove impossible to fix, regardless of when - or whether - peace is restored. The profound changes that have taken place in the functioning of the economy are unlikely to be easily reversed even if stability is attained. Almost half the population is living on an income below the UN’s own poverty threshold of $2 a day.
 
Trying to solve some of these issues, last Thursday the Palestinian occupied city of Bethlehem was the epicenter of a business conference with more than 1,200 foreign potential investors from all over the world who are ready to take risks and put their money in developing projects that will help to build an economy which is paralyzed due the Zionist occupation of Palestinian land.
 
Palestinian Authority leaders welcomed their guests by stressing that investing in the Palestinian Territories would be an investment in the promotion of peace and stability, not just for Palestine, but also for the entire region. They expect that the Palestinian economy will revive with the creation of a free, competitive and diversified market. Some of the potential projects include the building of affordable housing projects in the main occupied cities, and a commercial and residential center with an estimated cost of 200 million dollars. The main goal is to open new markets and sources of income by the creation of new job opportunities that should ease the daily life of the Palestinian people.
 
The Palestinian Prime Minister said in a press conference that investors signed $1.4 billion contracts for 11 large investments. He added that this would create 35,000 jobs, while the Palestinian Minister of Communication said that it would create 50,000 jobs. When a journalist questioned the Prime Minister what would be the government policy to help the popular classes to enable them to face the price crisis of fuel and food while the donors promise the PA $7.7 billion, he replied that Palestinians are poor. They are unable to subsidize them but what the government is able to do is to control prices!!
 
Despite of all the optimistic scenarios that investors and leaders may have for the future, there are facts that should be noticed as well.  The Palestinian areas of the West Bank and the Gaza Strip remain dominated by Israeli economic policies no matter what agreement both Israeli government and the Palestinian Authority are trying to agree upon. In addition to this, the economy of those disconnected areas depends for their development on international financial institutions, such as the World Bank and the IMF, which played a central role in designing not just the PA economy also the political context that shapes the daily lives of Palestinians.
 
In addition, starting any kind of economic activity in the Palestinian areas requires the approval of Tel Aviv, and it must be noticed that any investment that may take place in the Palestinian territories that could be approved by the occupying power, should not be in contradiction and compete with Israeli interests. Even if Israel would let some investments take place, who is going to protect the new projects if Israel decides to destroy them as they have done several times before, especially in 2002? At that time, Arab regimes paid for the reconstruction of Palestinian areas destroyed by the Occupation forces.
 
By doing things in this way, Israel is maintaining the principal objective of its economic policies for the Occupied Territories, that is, to undermine any kind of growth in the productive capacity of the future Palestinian state and keep it completely dependent upon international aid, which depends as well on the decision making of the Palestinian leaders, sometimes in clear contradiction with what the Palestinian people freely decided.
 
For instance, the Palestinian economy began to experience a descending level of the main indicators since the second Intifada started, when most of the international aid and western donor countries set conditions for their financial help toward the Palestinian people due the political situation.  After Hamas took control of the Gaza Strip in 2007 and the subsequent boycott by Western governments on the PA, the Palestinian economy just worsened.
 
The current siege on Gaza, with a population of more than 1,400,000 people, has a catastrophic effect not just on the daily lives of Palestinians, but it is also represents a collapse of all the economic activities in that area, where 96% of industrial operations have stopped, exportations are banned, with a direct impact in the creation of new job opportunities for the Palestinians. This makes 40% of the Palestinian population under occupation completely dependent on international aid. In the best case situation, where all the contracts will materialize, who can guarantee that the destroyed Palestinian infrastructure will be able to sustain the new major projects? 
For Israel, this is not a bad scenario, on the contrary, because most of the donor countries and organizations are forced to buy their aid goods on the Israeli market since it is the Israeli Government that decides which aid goods can be delivered to the Gaza Strip. On the other hand, the PA is left without any kind of control over the decision of which developing projects could take place on the areas under his jurisdiction, the West Bank. By doing so, what the donor countries and the Israeli policies of Occupation are actually doing is financing the internal conflicts inside the Palestinian population, especially since both areas, the Gaza Strip and the West Bank are completely disconnected to on another. 
 
Under this current scenario, any kind of private investment will be not possible in the Palestinian Occupied Territories, and the viability of the Palestinian economy will continue depending upon international aid and will just widen the current platform of Zionist occupation of Palestine.