UN warns of humanitarian crisis and imminent collapse of the Palestinian economy

The United Nations has warned that Palestine is experiencing an unprecedented humanitarian crisis and that economic and social conditions have reached a breaking point, while a clearing crisis with Israel is pushing Palestinian public finances to an impending collapse.

A report by the United Nations Organization for Trade and Development (UNCTAD), the results of which were announced on Tuesday, said that the Palestinian economy witnessed in 2018 and early 2019, a state of stagnation, per capita income decreased by 1.7%, the level of unemployment rose, poverty was high, and the outcome increased. Environmental damage in the Occupied Palestinian Territory: Gaza and the West Bank, including East Jerusalem.

The report, presented at a press conference held at the headquarters of the Palestinian Economic Policy Research Institute in Ramallah, warned that the short-term economic outlook for Palestine looks bleaker, and there are no indications that the main negative factors inhibiting economic growth will change in the future. near.

He said one in three Palestinians in the labor market was unemployed. In Gaza, the unemployment rate is more than 50%, while the poverty rate is 53%, although most of the poor are assisted by the government and international organizations.

"Gaza has become an increasingly unfit place for human life under harsh social and economic conditions." In 2018, its domestic economy contracted by 7%, resulting in a 10% decline in per capita income.

The international organization attributed the reasons behind the imminent collapse of the Palestinian economy, to "increase and tighten the grip of the occupation, strangling the local economy in Gaza, and a 6% decrease in donor support between 2017 and 2018, the deterioration of the security situation and lack of confidence due to gloomy political prospects."

The report said: Although the occupation imposes restrictions on all sectors of the economy, the sectors of agriculture and industry are more affected, and the resulting huge trade deficit negatively affect economic growth.

The report, presented by Birzeit University professor of economics Yusuf Daoud, indicates that the share of manufacturing in the economy shrank between 1994 and 2018 from 20 to 11% of GDP, while the share of agriculture and fishing fell from more than 12% to a small percentage. Less than 3%, "while the administrative and physical restrictions imposed by the occupation authority undermined the ability of Palestinian producers to continue and compete."

In the West Bank, 705 permanent physical barriers restricting the movement of Palestinian workers and goods have been identified by the United Nations. They belong to the list of dual-use goods, as well as banning other critical inputs, civilian goods that Israel claims have potential military applications.

The report said that the occupation isolates the Palestinian people from world markets, and therefore forces it to rely heavily on economic dependence on Israel, which accounts for 80% of the Palestinian people 's exports and 58% of its imports.

The small Palestinian market ranks fourth among the largest markets for Israel's exports, after the United States, China and the United Kingdom, but absorbs from imports from Israel the most absorbed by giant commercial markets such as France, Germany and India, and the value of Palestinian exports combined can not cover Bilateral trade deficit with Israel.

The UNCTAD report deprived the occupation of the Palestinian people from the exploitation of their oil and natural gas resources in the Gaza Strip and the West Bank, causing the Palestinian economy accumulated losses billions of dollars, in addition to the enormous cost of lost development opportunities, "and as long as this situation exists, This cost will increase and the economic costs of the occupation of the Palestinians will continue to rise. "

With regard to the financial crisis suffered by the Palestinian government due to the crisis of clearing with Israel, UNCTAD warned that "multiple financial shocks portend a more severe economic deterioration."

In addition to the unprecedented deterioration in socio-economic conditions, the report said, in July 2018, Israel passed a law requiring that Palestinian tax revenues be deducted from the amounts paid by the Palestinian government to the families of Palestinian martyrs and prisoners in Israeli jails. In 2019, with a deductible of $ 11.5 million per month from Palestinian clearing revenue ($ 138 million per year), the Palestinian government responded by refusing to receive anything less than the full amount of tax revenue owed to it.

He added: This confrontation over tax revenues deprives the Palestinian government of 65% of its revenues, or 15% of GDP, and because of the deprivation of the Palestinian government of two-thirds of tax revenues, has been forced to adapt through painful reductions of social assistance to the poorest groups, and pay 50 Only% of public sector salaries.

The report concluded that "this financial shock will exacerbate the already significant negative effects of diminishing donor support on the areas of production, employment opportunities and social and economic conditions," warning that "the continuation of this tax confrontation, may push the economy into recession and lead to financial collapse in Palestine."

Regarding environmental damage, the report said that "despite numerous UN resolutions, the pace of illegal Israeli settlements in the West Bank has accelerated, and settler violence in 2018 was the highest since 2014, and Palestinians are forced to leave their land and move elsewhere. Because of the violence, Israel also uses the West Bank as a "sacrifice zone" and a dumping site for hazardous waste produced inside Israel, threatening the health of the Palestinian people and the safety of their environment and natural resources.

At the same time, the destruction and destruction of Gaza's sewage infrastructure has led to an environmental collapse, and every day more than 100 million liters of untreated wastewater are dumped into the Mediterranean waters, resulting in widespread beach pollution. Four times higher than international environmental standards, this pollution puts public health at risk, undermines the fishing economy and deprives the population of the only affordable recreational possibilities offered by the sea.

"The international community should make greater efforts to promote responsible and sustainable industrial practices in Palestine and protect the public health of the Palestinian people," UNCTAD Secretary-General Mukhisa Kituyi said in a statement, commenting on the report.

The report recommended reversing the decline in donor support to the Palestinian people, further research to ensure economic and property rights for the Palestinian people, and determining its share in terms of oil and natural gas resources, which are shared by several neighboring countries in the region.

The international organization pledged to continue to work "towards the creation of an independent, democratic and viable Palestinian state, living side by side and at peace with all its neighbors, in line with all UN resolutions."

For the first time, the report included a chapter on Palestinian rights to oil and gas, and Israeli measures that prevent the Palestinian people from exploiting and developing these resources.

Masa research coordinator Raja al-Khalidi said that the authors of the report faced many Israeli obstacles, aimed at disrupting their work, and expected these obstacles to increase in the future.

He added: In December, UNCTAD will submit to the United Nations a comprehensive and detailed report, the first of its kind, on the tax system and tax leakage resulting from the Paris Economic Protocol, and we expect further dissatisfaction and obstacles by the occupation authorities to the organization's team in Palestine. .


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