On The Palestinian Economy
From Bernard Avishai’s article ‘The real hope of economic peace‘:
The good news is that the Palestinian private sector, though small, is prepared for a take-off. There is a tight-knit, highly competent Palestinian business class already running enterprises from pharmaceuticals to supermarkets, telecommunications to software solutions. Palestine’s billion dollar sovereign wealth fund, the PIF, has been investing strategically in construction and wireless telecommunications; it is transparently run by Mohammed Mustafa, a former World Bank official, close to Prime Minister Salaam Fayyad–in effect, the Ramallah bourgeoisie’s chairman of the board. The Palestinian stock market lists companies worth only about $2.5 billion, but it has been growing at over 20 percent a year. Palestinian universities graduate 1,200 computer scientists annually.
The Palestinian Authority gets about $2 billion from donor countries a year, a large portion of it wasted on patronage jobs. Part of what has stifled entrepreneurship is old Fatah cadres running monopolies from cement to petroleum. But public sector salaries, along with remittances from family members working abroad, at least wind up in bank deposits. Bank of Palestine CEO Hashim Shawa estimates that about $6 billion in total deposits are available for investment in genuinely competitive ventures. At least twice that amount is in Palestinian-controlled banks in Jordan. Regional investors know Palestinians are relatively well educated and need one of everything.
Also, for those interested, Rex Brynen has written a fascinating article on the economy of Gaza.
And here is Dan Senor on the Israeli economy.
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