World Bank issues Fayyad meeting a statehood checklist 12Apr10 April 13, 2010
Palestine Note - 12 April 2010
Monday the World Bank issued a report to the Ad Hoc Liaison Committee meeting in Madrid.
The Committee, comprised of 20 members and attended by PA Prime Minister Salam Fayyad and Middle East Quartet envoy Tony Blair, will kick off Tuesday to discuss the real action needed to implement a Palestinian state. The report “examines progress on the economic framework necessary for successful implementation of the PA’s program towards the establishment of a state,” says a press release made available to Palestine Note.
The report (found here) points to lifting Israeli economic restrictions on the West Bank, acceleration of Fayyad’s reform agenda, and “improved predictability” of donor support.
A key finding in the report is the PA’s continued “precarious” fiscal situation. The PA and the international community have celebrated the roughly 7% economic growth for the OPT in 2009, but the sustainability of that growth is uncertain. Gaza is responsible for 1% of that growth, and the Israeli blockade has strangled the Gaza economy, and as long as it continues, “economic reintegration [will be] more costly and difficult” if/when the Gaza and Ramallah government reunify.
To strengthen the PA fiscally, the World Bank recommends Israel continue to ease “economic restrictions on the West Bank,” and lift the siege on Gaza. The report emphasizes the unexplored economic potential in the West Bank’s Area C as well as “liberalizing of economic linkages” between the West Bank and East Jerusalem.
Looking to internal issues, the report recommends that the PA speed up its internal reforms, specifically “reduction of net lending in electricity distribution and reform of the pension system and social safety net.”
The report does no lose sight of the “decentralized nature” of the occupied territories and emphasizes the role of “local government units.” The World Bank supports a mindset that ensures “municipal financial viability.” Mariam Sherman, West Bank/Gaza World Bank director, says:
“The PA is well on the way to delivering on its promise to create a Palestinian state that can deliver services and economic prosperity to its population… However, concerted action is required to create an enabling environment for sustainable private sector growth: Continued lifting of economic restrictions by Israel, accelerated implementation of the PA’s reform agenda, and improved predictability of financial support by the donor community.”
World Bank VP for the MENA region Ms. Shamshad Akhtar added:
“All parties must bear in mind that economic integration of the West Bank and Gaza is critical to the viability of a Palestinian state in the medium and long-terms. The current political and security uncertainty, as well as the movement restrictions pose substantial impediments to the necessary integration of the Palestinian economy within the Middle East as well as globally.”
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