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Israeli and Palestinian Economies Crippled

Palestinian children suffer Isreali atrocities

LONDON, August 31, (IslamOnline & News Agencies) - Nearly two years of fighting have left half of the Palestinian work force jobless and raised the specter of malnutrition. In Israel, its violence against civilians has hobbled economic growth and shattered investor confidence.

A sharp decline in the economics of both Palestine and Israel was the immediate effect of the Israeli aggressions that blazed at the beginning of the Palestinian Intifada, a British based The Guardian reported Saturday, August 31.   

For the Palestinians, the fighting has led to utter paralysis in the economy. Some key indicators illustrating the downturn since 2000 in both economics were down here.

For Israel Gross Domestic Product (GDP), shrank by 1% in 2001 and is expected to fall another one percent this year. Income per capita fell by 3% in 2001 and is expected to fall another 3% this year, the Guardian added.

Michael Sarel, chief economist for the Israeli Finance Ministry, said the Intifada accounts for half the recession and the high-tech bust the other half.

Noting a 6% decline in income per capita over the last two years, he added: “This size of a decline in the Israeli economy is unprecedented,” the Guardian reported.

The rise in unemployment in Israel is now close to 11%, up from an average of 8% during the 1990s.

The tourism sector suffered the worst damages accounting for 3% of Israel's GDP before the uprising and has fallen by 70% since 2000. The fall was not restricted to the number of the tourists only, but also the hotels and all the workers in that field as tourists refused to visit the country where innocent people are being killed every day. 

The paper described the issue for the Palestinians as not being slower growth or fluctuations in this or that indicator. It's utter paralysis.

The Israeli military has imposed stiff curfews and sealed most major urban centers in the West Bank, severely restricting the movement of people and goods.

In Hebron, Nablus, Ramallah, Jenin and other towns, people are confined to their homes for days at a time.

The result has been economic collapse in the Palestinian territories. U.N. Middle East envoy Terje Roed-Larsen released data on Thursday, August 29 showing unemployment in the West Bank at 55%. In the Gaza Strip, he said, 70% of the people now live in poverty, defined as per capita consumption of less than $2 a day. The poverty rate was 23% in 1997, and 20% in 1990.

The Palestinian Child malnutrition has increased threefold since 2000. In a survey two years ago for the U.S. Agency for International Development, a study found that 22% of Palestinian children under age 5 are malnourished, up from 7%.

Unemployment during the second quarter of 2002 increased from 36% to 50% in the West Bank and Gaza Strip.

About 250,000 Palestinians, or a third of the labor force, traveled to Israel before the uprising began. These workers were the backbone of the Palestinian economy, each supporting an estimated 10 people on average.

The tourism sector also was badly affected in the West Bank and Gaza as there is virtually no investment at all. Aid money no longer goes to build the foundations of a Palestinian state, but to short-term relief meant to prevent malnutrition and epidemics.

In Bethlehem most souvenir shops have closed, and the three or four still open have no customers. “Ninety-nine percent discount!” shouts a vendor pleading for some business, any business.

Akeel Ibrahim sells bead necklaces outside Bethlehem's Church of the Nativity. He and 26 family members living in a three-room dwelling must now rely on handouts to survive.

“My brothers all lost their jobs in Israel,” says Ibrahim, 30. “We're praying to God to change this situation. Without tourists in Bethlehem, there is no life.”

Income losses resulting from loss of jobs in Israel - plus closures and restrictions in the Palestinian territories - stand at $7.6 million per day, or $3.3 billion since October 2000.

The Guardian report mentioned that the sources of this information were the United Nations, Israeli finance ministry, Palestinian trade ministry, U.S. Agency for International Development.  

 

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