The Palestinian industry is forecasted to collapse within months if Israel does not lift the closure and other trade restrictions imposed on the occupied territories since the outbreak of the Palestinian Intifada in September 2000, asserts a survey jointly conducted by Palestinian and American organizations.
The report indicated that unemployment has rapidly increased to 46 percent of the labor force in the Palestinian industrial sector. Another 32.7 percent of employees still working in industrial operations throughout the West Bank and Gaza Strip are expected to lose their jobs in the near future if restrictions persist.
No new businesses have been established since the flare-up of the Al-Aqsa Intifada in September 2000, and 17 percent of existing businesses were shut down. Over 65 percent of the manufacturing outlets, which operated in the West Bank in the year 2000, were established subsequent to the signing of the peace accords in 1993.
The above findings were published by The Palestinian Federation of Industry (PFI), The Palestine Trade Center (Pal Trade) and USAID’s Market Access Program (MAP/DAI), in a report assessing the impact of the Israeli measures on the Palestinian industrial sector. The study surveyed 600 manufacturing outlets in the Palestinian territories between June and July 2002.
Nearly 30 percent of the industrial facilities surveyed were found to be physically damaged— i.e. buildings, machinery, office equipment and inventory. Some 90 percent of the surveyed outlets reported losses resulting from sales drop, decreased productivity and increased costs of transportation. As a result, 50 percent of Palestinian manufacturers have become indebted to lenders.
Israeli-imposed internal and external movement restrictions have in effect formed ‘cantons’ within the Palestinian territories, rendering the supply of raw materials and the transport of goods inconsistent. As a result, local manufacturers have become ever more dependent on the small local markets, while the prices of locally made products have become less competitive.
The industrial sector, like all productive sectors in the West Bank and Gaza, is under considerable stress due to current circumstances. Decreased demand—as more and more Palestinians are without income—increased costs of production and distribution, restricted access to domestic and international markets, have all “conspired to reduce the vibrant Palestinian private sector to shadow of its former self,” said John Wetter, the senior country economist in the Word Bank Resident Mission in the Palestinian Territories. — (menareport.com)
© 2002 Mena Report (www.menareport.com)
