The Palestinian economy is expected to continue operating well below its potential and growth is projected to hover around 3 per cent, according to a new World Bank report.
Given population growth trends, income per capita is also expected to stagnate, damaging living standards, the Washington-based lender said.
In addition, a combination of fiscal constraints and the restrictions imposed by Israel hinder access to health care, adversely affecting the population, especially in Gaza.
The Palestinian Economic Monitoring Report will be presented to the Ad Hoc Liaison Committee, a policy-level meeting for development assistance to the Palestinian people, in New York on Wednesday.
The report highlights the economic challenges facing the occupied Palestinian territories and describes the constraints affecting health services.
“Over the last five years, the Palestinian economy has basically been stagnating, and is not expected to improve unless policies on the ground change,” said Stefan Emblad, World Bank country director for the West Bank and Gaza.
“The Palestinian territories have been in a de facto customs union with Israel for 30 years, but contrary to what was expected when the agreements were signed, the divergence between both economies has continued to widen, with income per capita in Israel almost 14 to 15 times higher than in the Palestinian territories.
“Poverty rates are stubbornly high, as roughly one out of four Palestinians lives below the poverty line. Our report reminds all parties of the vital urgency to act to spur per capita growth, as well as to put the fiscal situation on a sounder footing,” Mr Emblad said.
Growth of the Palestinian economy will continue to slow this year, weighed down by a lack of reforms, a financial crisis and the worsening political and security situation, the International Monetary Fund said last month.
High unemployment and poverty are adding to macroeconomic fragilities of the occupied West Bank and Gaza that are largely dependent of foreign aid and grants, the fund said.
After the post-pandemic rebound in 2021, gross domestic product growth nearly halved to 3.9 per cent in 2022 and is expected to decelerate further to 3 per cent in 2023, according to the IMF.
Palestine's economy was driven by the recovery in private consumption as authorities eased coronavirus pandemic-related movement restrictions, the World Bank said in a report in May.
The Palestinian economy remains at high risk under a multilayered system of Israeli restrictions on movement and trade in the West Bank, a near-blockade of Gaza, an internal divide between the West Bank and Gaza, severe fiscal constraints and an unfinished reform programme of the Palestinian Authority and several years of declining foreign assistance, the World Bank said.
Public revenue has increased noticeably in 2023, however, expenditures have also continued to grow, mainly driven by a rising public wage bill.
“Taking into account the only partial implementation of recent agreements between the government and labour unions, and Israeli deductions from revenue collected on behalf of the Palestinian Authority of about $256 million, as well as donor contributions, the deficit is expected to reach $493 million in 2023 or 2.5 per cent of gross domestic product,” the World Bank said.
“Should labour agreements be fully implemented, the deficit would increase further, reaching 2.7 per cent of GDP.”
Financing options are becoming increasingly limited, and the deficit is expected to continue being financed through arrears with private suppliers, the public pension fund, and public employees (who have already been receiving only 80 per cent to 85 per cent of their wages since late 2021), the report outlined.
The relentless accumulation of additional arrears would – in the long run – affect market liquidity and could eventually choke economic activity, with devastating effects on poverty levels as well as on social stability, it added.
Reform efforts by the Palestinian Authority, more financial support from donors and co-operation by the Israel government are necessary to achieve growth and fiscal sustainability, the lender recommended.
The World Bank suggested that Israel must transfer revenue collected from Israeli businesses operating in Area C and value-added tax on Israel-Gaza trade to the PA, and fully implement the e-VAT clearance system through the adoption of legislation mandating its use.
The Israeli occupation, the fragmentation of the Palestinian territories, and the broader macro-fiscal context have also significantly impacted the Palestinian healthcare system, the report said.
Neymar's bio
Total club appearances 411
Total goals scored 241
Appearances for Barca 186
Goals scored for Barca 105
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The Perfect Couple
Starring: Nicole Kidman, Liev Schreiber, Jack Reynor
Creator: Jenna Lamia
Rating: 3/5
if you go
Getting there
Etihad (Etihad.com), Emirates (emirates.com) and Air France (www.airfrance.com) fly to Paris’ Charles de Gaulle Airport, from Abu Dhabi and Dubai respectively. Return flights cost from around Dh3,785. It takes about 40 minutes to get from Paris to Compiègne by train, with return tickets costing €19. The Glade of the Armistice is 6.6km east of the railway station.
Staying there
On a handsome, tree-lined street near the Chateau’s park, La Parenthèse du Rond Royal (laparenthesedurondroyal.com) offers spacious b&b accommodation with thoughtful design touches. Lots of natural woods, old fashioned travelling trunks as decoration and multi-nozzle showers are part of the look, while there are free bikes for those who want to cycle to the glade. Prices start at €120 a night.
More information: musee-armistice-14-18.fr ; compiegne-tourisme.fr; uk.france.fr
SQUADS
UAE
Mohammed Naveed (captain), Mohamed Usman (vice-captain), Ashfaq Ahmed, Chirag Suri, Shaiman Anwar, Mohammed Boota, Ghulam Shabber, Imran Haider, Tahir Mughal, Amir Hayat, Zahoor Khan, Qadeer Ahmed, Fahad Nawaz, Abdul Shakoor, Sultan Ahmed, CP Rizwan
Nepal
Paras Khadka (captain), Gyanendra Malla, Dipendra Singh Airee, Pradeep Airee, Binod Bhandari, Avinash Bohara, Sundeep Jora, Sompal Kami, Karan KC, Rohit Paudel, Sandeep Lamichhane, Lalit Rajbanshi, Basant Regmi, Pawan Sarraf, Bhim Sharki, Aarif Sheikh
SPEC%20SHEET%3A%20NOTHING%20PHONE%20(2)
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UAE currency: the story behind the money in your pockets
Key facilities
- Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
- Premier League-standard football pitch
- 400m Olympic running track
- NBA-spec basketball court with auditorium
- 600-seat auditorium
- Spaces for historical and cultural exploration
- An elevated football field that doubles as a helipad
- Specialist robotics and science laboratories
- AR and VR-enabled learning centres
- Disruption Lab and Research Centre for developing entrepreneurial skills
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Read more about the coronavirus
How to help
Send “thenational” to the following numbers or call the hotline on: 0502955999
2289 – Dh10
2252 – Dh 50
6025 – Dh20
6027 – Dh 100
6026 – Dh 200
TEST SQUADS
Bangladesh: Mushfiqur Rahim (captain), Tamim Iqbal, Soumya Sarkar, Imrul Kayes, Liton Das, Shakib Al Hasan, Mominul Haque, Nasir Hossain, Sabbir Rahman, Mehedi Hasan, Shafiul Islam, Taijul Islam, Mustafizur Rahman and Taskin Ahmed.
Australia: Steve Smith (captain), David Warner, Ashton Agar, Hilton Cartwright, Pat Cummins, Peter Handscomb, Matthew Wade, Josh Hazlewood, Usman Khawaja, Nathan Lyon, Glenn Maxwell, Matt Renshaw, Mitchell Swepson and Jackson Bird.
Ferrari 12Cilindri specs
Engine: naturally aspirated 6.5-liter V12
Power: 819hp
Torque: 678Nm at 7,250rpm
Price: From Dh1,700,000
Available: Now
Company profile
Name: Steppi
Founders: Joe Franklin and Milos Savic
Launched: February 2020
Size: 10,000 users by the end of July and a goal of 200,000 users by the end of the year
Employees: Five
Based: Jumeirah Lakes Towers, Dubai
Financing stage: Two seed rounds – the first sourced from angel investors and the founders' personal savings
Second round raised Dh720,000 from silent investors in June this year
Specs
Engine: Dual-motor all-wheel-drive electric
Range: Up to 610km
Power: 905hp
Torque: 985Nm
Price: From Dh439,000
Available: Now
UAE currency: the story behind the money in your pockets
What drives subscription retailing?
Once the domain of newspaper home deliveries, subscription model retailing has combined with e-commerce to permeate myriad products and services.
The concept has grown tremendously around the world and is forecast to thrive further, according to UnivDatos Market Insights’ report on recent and predicted trends in the sector.
The global subscription e-commerce market was valued at $13.2 billion (Dh48.5bn) in 2018. It is forecast to touch $478.2bn in 2025, and include the entertainment, fitness, food, cosmetics, baby care and fashion sectors.
The report says subscription-based services currently constitute “a small trend within e-commerce”. The US hosts almost 70 per cent of recurring plan firms, including leaders Dollar Shave Club, Hello Fresh and Netflix. Walmart and Sephora are among longer established retailers entering the space.
UnivDatos cites younger and affluent urbanites as prime subscription targets, with women currently the largest share of end-users.
That’s expected to remain unchanged until 2025, when women will represent a $246.6bn market share, owing to increasing numbers of start-ups targeting women.
Personal care and beauty occupy the largest chunk of the worldwide subscription e-commerce market, with changing lifestyles, work schedules, customisation and convenience among the chief future drivers.
