Gaza facing ‘dangerous fiscal crisis’: World Bank

The Gaza Strip has the world’s highest unemployment and Palestinians, Israelis and donors must take action to avoid a “dangerous fiscal crisis,” the World Bank said Friday. The report, prepared ahead of the bi-annual meeting of the Ad Hoc Liaison Committee (AHLC) which coordinates international donor support for the Palestinians, comes nearly a year after the 50-day conflict between Gaza militants and Israel, in which around 2,200 Palestinians were killed. According to the World Bank, the virtual disappearance of Gaza’s exports can be explained by no other variable than “war and the blockade.”

The impact of the blockade imposed in 2007 was particularly devastating, with GDP losses caused by the blockade estimated at above 50 percent and large welfare losses.

World Bank report

The World Bank urged the Palestinian Authority, Israel and the donor community to take “actions” and carry out “reforms” in order “to reverse the recent and worrisome slowdown in economic growth” and “avoid a dangerous fiscal crisis.” The report said unemployment in Gaza increased in 2014 “to reach 44 percent - probably the highest in the world,” with the poverty rate in the Palestinian territory reaching 39 percent, despite the fact that nearly four of every five Gazans receive “some aid.” The World Bank said that to rebuild Gaza’s economy, “a unified Palestinian government in both West Bank and Gaza” was required.

Middle East