The World Bank has released a report claiming that Palestine’s economy is not matured enough to support an independent state any time soon. The report acknowledges the efforts of the political authority but warned of risks.
In a statement accompanying the report, economist John Nasir said that “the Palestinian Authority (PA) has made steady progress in many years towards establishing the institutions required by a future state but the economy is currently not strong enough to support such a state” and with the Palestinian Authority asking for support, in just a few days ago, because of the worst financial crisis it is undergoing since its founding eight years ago testify to his sayings. He went on to add that “economic sustainability cannot be based on foreign aid so it is critical for the PA to increase trade and spur private sector growth.”
Presently, Palestine has an outstanding debt of $1.5 billion coupled with a cash deficit of half a billion dollars. It was able to get a pledge of a hundred million dollars from Saudi Arabia.
The report hinted that “the Palestinian Authority has had considerable success in building the institutions of a future state; it has made less progress in developing a sustainable economic base.”
The report also accused Israel of making investment difficult in the country due to security restrictions it imposes.
The World Bank recommends two options to Palestine. It is either to focus on certain areas and improve their current performance or by emulating Asian countries by sustaining high levels of economic growth by adopting an outward orientation and integrating into world supply chains.
Palestine: Economy can’t support statehood
