In two reports by the United Nations agency for Palestinian refugees (UNRWA), Gaza is reported to have one of the highest unemployment rates in the world at 45 per cent in the second half of 2010, with a quarter of people in the West Bank unemployed in the same period.
Despite the easing of restrictions by Israel to allow the import of consumer goods and the export of produce such as flowers and strawberries, Gaza’s private businesses are struggling. Over 8,000 jobs were lost in the private sector and some businesses continue to report difficulties in obtaining raw materials. With a fall in private sector employment, there is an even greater reliance in the territory on public sector jobs. Employment in the public sector in Gaza rose nearly 3 per cent in the second half of 2010, with Gazans increasingly dependent on the salaries paid out by the Hamas government.
In the press release issued alongside the report, a spokesperson for UNRWA said it was “hard to understand the logic of a man-made policy which deliberately impoverishes so many and condemns....productive people to a life of destitution”. The UNRWA statement also suggested the rise in public employment figures was an indication that Israel’s policy of using the blockade to “weaken the Hamas administration....has failed.”
One consequence of the economic hardship in the Palestinian territories is that families frequently rely on sending children out to work. According to Save the Children, around 40,000 youngsters under 18 years are involved in some kind of employment in the West Bank and Gaza, nearly three-quarters going out to work because of their families’ severe financial conditions.
Over the last few years, the economy of the West Bank was believed to be improving following the relaxation of Israel’s military occupation. However, the new report from UNRWA challenges this assumption. It found that unemployment in the West Bank grew during the second half of 2010 to stand at 25 per cent, compared to 23.6 per cent in the same period of 2009. High unemployment was also found to be undermining wages, which had dropped by nearly 3 per cent compared to the same period last year. Analysts have warned that any apparent ‘boom’ in the economy of West Bank was more through the funding of international donors than from any real sustainable growth.
The Guardian reported the Prime Minister, Salam Fayyad, as saying that any economic recovery was at risk without a political solution to the Israeli-Palestinian conflict. But though US officials are meeting with Israeli, Palestinian, Jordanian and Egyptian representatives this week to try to revive the Middle East peace talks, most observers are not hopeful of progress.