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Poverty in Palestine: the human cost of the financial boycott

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240108 - Palestine Monitor factsheet: Poverty

“46% of Palestinians do not have enough food to meet their needs. The number of people in deep poverty, defined as those living on less than 50 cents a day, nearly doubled in 2006 to over 1 million, according to the United Nations Relief and works Agency (UNRWA)."

 

Poverty in Palestine: the human cost of the financial boycott, Oxfam International, April 2007

Suspending Aid to Palestine: The Facts

- In January 2006 Hamas decisively won the Palestinian parliamentary elections, internationally recognized as free and fair. In February 2006, the Israeli Government began withholding Palestinian VAT revenues of some US$ 60 million per month from the Palestinian Authority (PA), which represented 55% of the PA’s annual budget.

- Two months later, a number of key donors including the European Union (EU), Canada and the United States suspended aid to the PA.

- This aid suspension left a 25% deficit in the PA’s annual budget. The PA was therefore denied approximately 80% of its budget.

- In July 2006, 3 months after the suspension of donor aid, the EU established a Temporary International Mechanism (TIM), which was designed to provide direct support to Palestinians whilst circumventing Palestinian government channels.

- According to Oxfam International, the TIM was “unable to prevent the growing humanitarian crisis caused by the financial boycott and by the violence” whilst at the same time massively undermining the Palestinian public sector whose development the international community itself funded during the Oslo years.

- Oxfam reported “immense suffering” and insecurity as a result of the donor aid embargo and the withholding of VAT revenue from the PA.

- John Dugard is the United Nations Special Rapporteur on the situation of human rights in the Palestinian territories. In January 2007 he presented a report to the UN Human Rights Council in which he described these funding cuts as “possibly the most rigorous form of international sanctions imposed in modern times” and stated that this is “the first time an occupied people have been so treated.”

- On July 1st 2007, Israel announced that it intended to return the VAT revenue it owes to the PA, starting with an initial payment of $120 million. Israel will apparently transfer the remaining funds to the PA over the next 6 months, though there are disagreements over how much Israel owes the PA in total.

Poverty in the West Bank and Gaza


- When internal political divisions, deepened by the sanctions, deteriorated into heavy internal fighting in the Gaza Strip in early June 2007, ending in the dissolution of the Palestinian National Unity Government and the establishment of a Fatah-dominated Emergency Government, the EU announced on June 18 it would end its 15 month embargo of the Palestinian Authority and resume direct aid.

- The PA is the largest employer in the West Bank and Gaza, employing 161,000 people, who in turn support almost 1 million dependents. The majority of these PA employees have not been regularly paid for more than a year due to Israeli withholding of Palestinian Authority VAT revenue. In October 2006 Palestinian banks reported an average debt of $2,000 for PA employees.

- In the West Bank up to 67% of Palestinians are classified as living in poverty. In Gaza approximately 88% of Palestinians live in poverty: 35% of them are classified as ‘extremely impoverished.’

- 50% of Palestinians in the West Bank and Gaza currently rely on donor food aid for at least some of their food. This means that 1.8 million Palestinians are now partially or fully dependent on food aid.

- Increasing numbers of Palestinian children are now working to support their families instead of attending school. Children under fourteen can cross Israeli checkpoints without permits, and at least 1,000 Palestinian children a day cross into Israel, to work in garbage tips salvaging glass and metal.

- Filippo Grandi, Deputy Commissioner General, United Nations Relief and Works Agency (UNRWA) declared after visiting the Gaza Strip on 9 August 2007: “Gaza risks becoming a virtually one hundred per cent aid dependent, closed down and isolated community within a matter of months, or even weeks, if the present regime of closures continues.”

Freedom of Movement and Poverty

- The United Nations Office for the Coordination of Humanitarian Affairs (OCHA) cites Israel’s matrix of movement restrictions as “a primary cause of poverty and the humanitarian crisis in the West Bank and Gaza Strip.”

- Following Israel’s redeployment from the Gaza Strip in August 2005, border closures were enforced by the Israeli military at all crossings between Gaza and Israel, and Gaza and Egypt. This seriously damaged the residual Gazan economy.

- On 18 November 2005, the Government of Israel (GOI) and the PA signed an Agreement on Movement Access (AMA) brokered by US Secretary of State Condoleeza Rice. This was designed to facilitate the movement of people and goods within the Occupied Palestinian Territories (OPT), and to open Rafah Crossing on the Gaza-Egypt border in order to “promote peaceful economic development” and improve the humanitarian situation in Gaza.

- The Rafah Crossing is vitally important to the Gazan economy, since it is the Gaza Strip’s only border crossing with a country other than Israel.

- Under the AMA, the Israeli Government clarified that it would not close a passage due to a security incident unconnected with the passage itself.

- However, between June 2006 and March 2007, the Rafah crossing opened just 16% of scheduled working hours. Each day the crossing was closed Palestinians in Gaza lost approximately $500,000 worth of exports. The vast majority of exports from Gaza are perishable food items, such as fish and fruit.

- Gaza now has the highest poverty rates in Palestine, a factor directly related to prolonged Israeli border closures.

- In November 2006, OCHA reported that 60% of Palestinian families who own land in the ‘seam zone’ area of the northern West Bank were being denied access by the GOI. Seam zones are land lying between the Wall and the 1967 Green Line that are occupied by Israel.

According to OCHA:

Traditional travel routes have been severed in 90% of these communities.
More than 50% of communities surveyed no longer had direct, regular access to their land.
22% of land was accessible only by foot, so no vehicles could be used to transport produce grown there.

- In May 2007 the World Bank researched movement and access restrictions across the West Bank. The Bank concluded that “…without efficient and predictable movement of people and goods, there is very little prospect of sustainable Palestinian economic recovery….only through a fundamental reassessment of closure and a restoration of the principle of presumption of movement… will the Palestinian private sector be able to recover and fuel sustainable growth.”

 
 

 

 

 

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