The Palestinian GNP was 38% lower in 2002 than in 1999, according to a World Bank report on the impact of the first 27 months of the intifada.
The World Bank reports that unemployment amounted to 37% of the labor force at the end of 2002. The stricter standards utilized by the International Labor Organization (ILO), which only include people actively seeking work in the labor force, show 27% unemployment at the end of 2002.
Per capita income fell by over 46%, compared with 1999, and the poverty rate, defined as less than $2.10 a day in income, was almost 60% of the population, compared with 21% on the eve of the intifada. The Palestinian population grew by 13% between 1999 and 2002.
Palestinian imports and exports were cut by a third in the period examined. Investment fell almost 90% from $1.45 billion in 1999 to $150 million in 2002. Physical damage from the conflict rose from $305 million at the end of 2001 to $930 million at the end of 2002.
The World Bank states that the Palestinian Authority’s (PA) financial situation is very unstable. Monthly revenues fell from $91 million in December 2000 to $18 million in December 2002, due to rising unemployment, falling demand, and the halt in money transfers from Palestinians working in Israel. The (PA) received an average of $39 million a month in aid from donor countries in 2002.
The World Bank reports that the Palestinian private sector suffered the most economic damage. GDP fell 35% between 1999 and 2002, and the PA owes private sector suppliers $200 million.
The World Bank states that the main cause for the Palestinian economic crisis was Israel’s policy of internal and external closures that restricted movement. The number of Palestinian workers in Israel fell from 128,000 in September 2000 to 32,000 in December 2002.
Published by Globes [online] - www.globes.co.il - on July 9, 2003