Overview

  • The World Bank has assisted the Palestinians since the Oslo Accords of the early 1990s – continuing to lay the foundation of a future Palestinian state so that it can deliver services to the people. Grants, financed from the World Bank’s own income and supplemented by Trust Funds contributed by donors, fund the Palestinian Authority’s projects in water and sanitation, municipal, education and social protection sectors. 

    The lack of progress towards peace and reconciliation creates an unsustainable economic situation. The Palestinian internal polity is sharply divided between Gaza and the West Bank. Due to a steep deterioration in Gaza and a slowdown in the West Bank, the Palestinian economy witnessed no real growth in 2018. The unemployment rate was 31 percent in 2018—with 52 percent of Gaza’s labor force unemployed, including two out of every three youth. The Palestinian Authority’s financing gap persisted in 2018 mainly due to insufficient budget support and was financed through additional arrears. The West Bank and Gaza ranked 116th out of 190 economies in the 2019 Doing Business report.

    Last Updated: Apr 01, 2019

  • A sustainable growth path for the Palestinian economy depends on a domestic private sector that can compete in regional and global markets and increase its export of goods and services. Thus, the World Bank Group’s assistance strategy for 2018-21 is focused on creating a conducive environment for private investment in the productive sectors of the economy.

    Increased investment can enhance the capacity of the economy, inspire entrepreneurial effort, and generate the jobs that are needed—especially for the large number of unemployed youth and women. This is built on the World Bank Group’s maximizing finance for development approach. Beyond efforts to support the private sector, a strong focus on shared prosperity is critical for renewing the social contract via better (public) service provisions and social protection. The three pillars of the assistance strategy are:

    1.Setting the conditions for increased private investments and job creation

    2.Private Sector Enhancement Facility to realize private investments

    3.Addressing the needs of the vulnerable and strengthening institutions for improved citizen-centered service delivery.

    The World Bank has maintained a robust analytical program. The Bank’s report to the September 2018 Ad Hoc Liaison Committee (of donors) analyzed the nature of the decline of the Gazan economy and identified the needs going forward. 

    Last Updated: Apr 01, 2019

  • Through the support of the Masar Ibrahim (Abraham Path) Project nearly 92,000 hours of work were created in 2018 along the Abraham Path in the West Bank—for homestays’ preparation of meals, hospitality, overnight stays, and for guides and drivers. 

    • Since 2017, about 60 percent of the 81 jobs created by entrepreneurs—that were supported under the Finance for Jobs Project—were filled by young people (under age 30), and about a third of entrepreneurs supported are women.
    • The North Gaza Wastewater Treatment Plant and the Beit Lahia Terminal Pumping Station became operational.
    • A public platform supported by the Cash Transfer Project allows citizens to give feedback to the Ministry of Social Development about the social safety net and for the ministry to respond.

    Last Updated: Apr 01, 2019

  • The Bank functions as the secretariat for the Ad Hoc Liaison Committee (AHLC) of donors to the Palestinian Authority. The Bank submits a report prior to each meeting updating partners on recent economic and fiscal trends,  and provides economic and institutional analysis.

    A World Bank administered multi-donor Trust Fund has channeled budget support (approximately US$1.5 billion since its inception) in support of the Palestinian Authority’s reform program in macro-fiscal strengthening and public financial management. Australia, France, Japan, Norway, and Kuwait have committed to continue channeling their budget support through this Palestinian Reform and Development Plan Trust Fund.

    The Partnership for Infrastructure Multi-Donor Trust Fund (PID MDTF), established in 2012 to provide financial and technical support for the coverage, quality, and sustainability of infrastructure. Focusing on the water, urban development, and energy sectors, the PID MDTF has active participation from Croatia, Denmark, Finland, France, the Netherlands, Norway, Portugal, Sweden and the U.K. with contributions of US$145 million.

    Besides its support in the above-mentioned Trust Funds, the Government of Norway cooperates with the World Bank via the Norway West Bank and Gaza Support Trust Fund, which was established in 2014 with a $2 million pledge. It supports aid coordination by the and analytical work in energy, education, and private sector development.

    Last Updated: Apr 01, 2019

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LENDING

West Bank and Gaza: Commitments by Fiscal Year (in millions of dollars)*

*Amounts include IBRD and IDA commitments



PHOTO GALLERY

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Additional Resources

Country Office Contacts

Palestinian territories
+972 -2-2366500
mkoussa@worldbank.org