{"id":181597,"date":"2001-10-12T00:00:00","date_gmt":"2019-03-11T21:13:27","guid":{"rendered":"https:\/\/www.un.org\/unispal\/?p=181597"},"modified":"2019-03-11T21:13:27","modified_gmt":"2019-03-11T21:13:27","slug":"auto-insert-181597","status":"publish","type":"document","link":"https:\/\/www.un.org\/unispal\/document\/auto-insert-181597\/","title":{"rendered":"Palestinian economy – UNCTAD report"},"content":{"rendered":"
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\n\t\t\t\tREPORT ON UNCTAD'S ASSISTANCE TO THE PALESTINIAN PEOPLE<\/strong><\/span> <\/span>\n\t\t\t\t<\/div>\n
\n\t\t\t\tPrepared by the UNCTAD secretariat <\/strong>\n\t\t\t\t<\/div>\n
\n\t\t\t\tExecutive summary<\/strong>\n\t\t\t\t<\/div>\n
\n\t\t\t\t
\nCritical developments in the Palestinian economy during 2000-2001 have exposed long-standing st ructural weaknesses, which have been aggravated by sharp declines and widespread disruption in economic activity over the period. A high and volatile rate of unemployment, a chronic trade deficit and a widening gap between investment needs and national savings reflect persistent imbalances, which have been reasserted during the recent crisis. While some significant structural changes have occurred over the decade, these were not paralleled by notable improvement in the domestic economy's supply capacity, undermining its ability to create enough jobs for its labour force, produce enough exports to pay for imports and generate savings for financing investments. Furthermore, the weak contribution of domestic sources to growth of national income increases the economy's vulnerability to external shocks.\n\t\t\t\t<\/div>\n
\n\t\t\t\tDespite the progress in institution building, regulatory reform and economic policy formulation made during the 1994-1999 interim period ushered in by the Israel-Palestine peace accords, over nine months of economic crisis have reversed many of these gains. In addition to losses of at least a quarter of national income and damage to economic and trade infrastructure, the crisis has resulted in sharp falls in Palestinian household income, massive unemployment and increasing poverty. The Palestinian Authority will need to elaborate swiftly a programme of recovery and reconstruction in the context of a sustained economic policy formulation process. While UNCTAD technical assistance to the Palestinian people has attempted to respond to some of the new needs generated by the crisis in the trade and related services sectors, it has maintained a focus on long-term capacity building efforts. Operational activities aim to match the secretariat's core technical competencies with the development needs of the Palestinian Authority and targeted donor finance. In doing so, the secretariat has further strengthened its cooperation with concerned international agencies and donors in providing concrete assistance to the Palestinian people.<\/span> <\/span>\n\t\t\t\t<\/div>\n
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\n\t\t\t\t<\/div>\n
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\nCONTENTS<\/strong>\n\t\t\t\t<\/div>\n
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\nChapter Page<\/strong><\/span> <\/span>\n\t\t\t\t<\/div>\n
\n\t\t\t\tI.\n\t\t\t\t<\/div>\n
\n\t\t\t\tTable 1: Palestinian economy (West Bank and Gaza Strip) – Main aggregate economic indicators 1993–2000<\/span> <\/span>\n\t\t\t\t<\/div>\n
\n\t\t\t\tTable 2: UNCTAD programme of technical assistance to the Palestinian people, 1997-2002 <\/span><\/p>\n
\n\t\t\t\t<\/div>\n
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\nChapter I<\/strong><\/span> <\/span>\n\t\t\t\t<\/div>\n
\n\t\t\t\tDEVELOPMENTS IN THE PALESTINIAN ECONOMY, 2000-2001 <\/strong><\/span>
\n<\/span>\n\t\t\t\t<\/div>\n
\n\t\t\t\tA. <\/span> Persistent structural weaknesses <\/strong><\/span>\n\t\t\t\t<\/div>\n

<\/p>\n

\n\t\t\t\t1. <\/span>Developments in 2000-2001 have not only had a debilitating impact on all economic and social sectors of the occupied Palestinian territory but have also exposed some underlying structural weaknesses in the Palestinian economy which have confounded its sustained development for many years. <\/span>1<\/u><\/sup><\/a> The recent crisis has served to focus attention again on these key weaknesses and the adverse development path that they imply for the Palestinian economy. Pursuing a recovery begun in late 1997, the Palestinian economy enjoyed vigorous growth in 1998-1999, with real gross domestic product (GDP) estimated to have grown by 6 per cent in 1999. <\/span>2<\/u><\/sup><\/a> Real per capita gross national income (GNI) growth was estimated at 3.5 per cent, bringing per capita GNI to $1,965. GDP and GNI growth had been projected to continue in 2000, albeit at lower levels, and it appeared for a brief moment during that year that the economy was set on a more sustainable path of growth. <\/span>
\n<\/span>\n\t\t\t\t<\/div>\n
\n\t\t\t\t2. <\/span>However, the Palestinian economy during the interim period continued to feature chronic imbalances. Previous reports and studies by UNCTAD have analysed deep-seated and persistent structural problems facing the Palestinian economy. <\/span>3<\/u><\/sup><\/a> <\/span>Insufficient job-creation, a low savings rate and poor export performance all point to chronic weaknesses on the supply-side of the economy, which perpetuates excessive reliance on the Israeli economy. This in turn makes the Palestinian economy particularly vulnerable to external shocks and undermines efforts to establish a more stable macroeconomic environment, necessary for the emergence of a sustainable growth path. <\/span>
\n<\/span>\n\t\t\t\t<\/div>\n
\n\t\t\t\t3. <\/span>Despite the progress in institution building, regulatory reform and economic policy formulation made during the 1994-1999 interim period ushered in by the Israel-Palestine peace accords,<\/span> <\/span>4<\/u><\/sup><\/a> the findings of previous research appear even more pertinent in the light of recent developments. The interplay between long-standing constraints and new pressures may be illustrated in several aggregate indicators, which portray the continuing Palestinian economic predicament and highlight the vulnerability of the economy to external shocks, such as those experienced in 1991, 1994, 1996 and again in 2000 (see table 1):<\/span>\n\t\t\t\t<\/div>\n
\n\t\t\t\t \n\t\t\t\t<\/div>\n