World Bank: Israel grip on West Bank costs Palestinian economy $3.4bn

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The Palestinian economy is losing out on a potential $3.4 billion a year due to Israeli restrictions on the West Bank, the World Bank said in a report published on Tuesday.

If Israel were to lift the restrictions on the 61 percent of the West Bank that it controls, then Palestinians could expand their dwindling economy by 35 percent of its 2011 Gross Domestic Product, the report said.

By allowing Palestinians develop on the restricted area which, the deficit of the self-rule government, currently dependent on foreign aid, would drop by half, according to World Bank estimates.

Israel has said it wants to see the Palestinian economy grow, but has maintained that the fate of the West Bank will be decided in upcoming negotiations.

“More than half the land in the West Bank, much of it agricultural and resource rich, is inaccessible to Palestinians,” said the World Bank.

“The first comprehensive study of the potential impact of this ‘restricted land,’ released by the World Bank today, sets the current loss to the Palestinian economy at about $3.4 billion,” it added.

The International Monetary Fund has estimated that the Palestinian GDP growth would slow from 11 percent in 2011 and 5.9 percent in 2012 to 4.5 percent by the end of this year.

Last month, the Middle East Quartet published a plan to revive the ailing Palestinian economy, in an effort to support peace negotiations between Israel and the Palestinians.

The three-year “Palestinian Economic Initiative” would focus on private sector growth. It identified eight key sectors targeted for development, including construction and building materials, agriculture, energy and water, and tourism, according to Agence France-Presse.

(With AFP)

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