World Bank-West Bank and Gaza Partnership

A street scene in Gaza. For the World Bank, it is crucial to strengthen the Palestinian Authority’s leadership to enable it to boost private sector growth and increase trade. Photo by: Natalia Cieslik / World Bank / CC BY-NC-ND

Despite numerous attempts, efforts to resolve decades-old conflict between Israel and the Palestinian territories have failed to achieve significant progress.

These longstanding tensions have severely hampered development in West Bank and Gaza, where poverty levels remain high. Although there have been steady improvements in reducing poverty, the level of destitution in Gaza stands at 33.7 percent — twice that of the West Bank. This makes it unlikely for West Bank and Gaza to meet their Millennium Development Goal on reducing poverty, as well as their child mortality and environmental sustainability targets by 2015.

The Palestinian Authority, meanwhile, continues to face difficulties in managing an economy that relies heavily on external assistance. Israeli restrictions and the Palestinian Authority’s heavy borrowing make compound fiscal difficulties and make economic growth unsustainable. This, in turn,has affected the competitiveness of West Bank and Gaza’s private sector and resulted in high unemployment rates.

Nonetheless, the Palestinian Authority has taken strides to strengthen its institutions and has shown significant commitment to building a stronger economy based on private sector growth. The World Bank aims to continue building on the achievements of its previous interim strategies and work closely with the Palestinian Authority to support its national development plan.

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