Israel's Support of the Palestinian Economy

What you never hear about in the mainstream media.


Since the Palestinian Authority (PA) and Israel signed the Oslo Accords in 1993, Israel has been working with the PA to help develop a viable, even vibrant economy for the Palestinians that provides jobs and support the infrastructure for viability. A strong economy is essential for stability and, hopefully, will lead to the development of social and democratic institutions. Even during periods of escalated violence against Israel, including Intifadas and rockets reigning down from Gaza deliberately targeting civilians, Israel continued its efforts to improve the lives of the Palestinians.
Many of the things Israel does on a daily basis go without public notice, vastly under-reported in the media. The hope is that prospects of a better future for the Palestinians will enhance the chance for peace.

The Facts

(1) In September 2012, with the Palestinian Authority (PA) facing severe financial strain due to a shortfall in international donations and significant overspending, Israel advanced the PA 250 million shekels in tax revenues to aid the Palestinian economy. Similarly, in July 2012, Israel advanced the PA 180 million shekels to ensure that the salaries of PA employees were paid before the Muslim holiday of Ramadan.

(2) Since the signing of the 1993 Oslo accord, real GDP per capita in the West Bank has increased considerably. From 1998-2011, these numbers grew from about $1,750 to about $2,000 according to the June 2012 U.S. congressional report U.S. Foreign Aid to the Palestinians. The report also notes that Gaza experienced a considerable rise in real GDP per capita from 2002-2005 before the Hamas takeover.

(3) In order to reduce the level of Palestinian unemployment, Israel has increased the number of permits for Palestinians to work in Israel - by 40% since February 2011.

(4) Despite the constant barrage of rocket attacks emanating from the Gaza Strip, Israel provides most of the electric supply for both the West Bank and Gaza. Approximately half of Gaza’s electricity is supplied directly from Israel by way of the Israel Electric Corporation (IEC). The remaining supply comes mostly from the Gaza Power Plant (GPP), which is funded not by Hamas but by the Palestinian Authority.
Indeed, the PA reportedly spends approximately 40% of its annual budget on Gaza. Thus, much of the billions of dollars in international aid that is provided to the Palestinian Authority is in turn sent to the Hamas-controlled Gaza Strip.
Despite owing the Israel Electric Corporation over 662 million shekels, Israel continues to provide electricity to the PA. This includes supplying electricity to government buildings such as schools, hospitals, and water pumping stations.

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