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An alternative aid agenda for Palestinians
Published Friday 09/11/2012 (updated) 13/11/2012 16:27
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By Nadia Hijab, Alaa Tartir
and Jeremy Wildeman


In an earlier piece on Maan, we analyzed the persistence failure of the World Bank’s policies in the occupied Palestinian territory and argued for alternative models of international aid that “challenge the status quo while enabling Palestinians to survive.”

It is often easier to criticize than to make alternative suggestions. Yet there are areas that donors can and should support that would focus aid on ways to counter dispossession, keep Palestinians on their land, and challenge Israel’s occupation policies and practices without forfeiting the ability to function in the oPt.

Here are three: promoting self-reliance in basic foods and reversing the decline of the agricultural sector; supporting cooperatives and local economic enterprises; and assisting sectors such as information technology that could break through the barriers Israel has erected around the Palestinian economy. Most importantly, they should do no harm.

None of this is impossible. During the first Intifada, and despite Israeli counter-measures, Palestinians in the oPt reduced their economic dependence on Israel by promoting local consumption and generating local employment. The situation is much more complex today given the far greater fragmentation of the territories and illegal Israeli settlement building. Nevertheless, there is still much that can be done.

The first step must be to reverse the decline in the agricultural sector: Its contribution to GDP fell from around 13.3 percent in 1994 to 5.2 percent in 2010. Although this was largely due to Israeli colonization practices, it is also due to Palestinian Authority and donor neglect that have left the sector seriously under-resourced. No more than 1 percent of the total annual budget has been allocated to agriculture sector since the PA was formed (around 85 percent of which goes to staff salaries) and agriculture dropped to around 0.74 percent of international total aid by 2006.

Moreover, the sector was steered from key staples to cash crops for export and thus reducing self-reliance. Instead, PA and donor policies should support low-intensity agriculture, using targeted subsidies to enable farmers to stay on their land and reinforce its productivity; this can also help create jobs. The food produced should be directed primarily to local markets, reducing dependency on food aid and Israeli imports.

In addition, it should be possible to support integrated agricultural units. For example, herbs can serve as fodder in winter, trees can provide food as well as animal feed and fuel, with tools and machinery maintained by local mechanics. Other possibilities include urban agriculture, aquaponics, and “vertical gardens” that have been piloted among Palestinian refugees in camps in Lebanon and in the oPt. Youth initiatives to support farmers and encourage volunteerism, such as Fariq Saned, are inspiring examples. PA departments can assist by providing access to finance, technical assistance, and institutional memory, among other support.

Secondly, it is important to promote cooperatives and local economic enterprises. Cooperatives have also been neglected in the oPt despite their economic potential in agribusiness, small industry, and crafts production. Cooperatives can help break barriers, overcome geographic isolation, and expand markets – and build social solidarity and self-reliance.

Although some aid has been directed to cooperatives, there is insufficient donor understanding that this is an economic enterprise albeit with social responsibility. Some aid unwittingly weakens cooperatives by dealing with them as charitable grant-making organizations, feeding into a culture of dependency rather than self-reliance among communities.

Rather, investment should be made in building the capacity of both the government’s cooperative department and existing cooperative associations on sound governance, enterprise development, and cooperation principles. Recent investment in the capacity of women-majority Union of Cooperative Associations for Savings and Credit in the oPt provides useful lessons.

Indeed, women’s economic activity can be targeted through cooperatives since most women already work in family-based agriculture and in food and handicrafts micro-enterprises. There is in addition a need to identify new niche markets, especially in services, so as to increase both the scope and diversity of women’s work.

Another avenue for donor assistance is to develop sustainable local enterprise networks that promote local market-based approaches. Samer Abdelnour has documented on Al-Shabaka, experiences in the Sudan as well as in Lebanon and in the oPt. Efforts in the oPt that could be developed among these lines include community permaculture projects in Nablus and Beit Sahour, and the fair trade initiatives Zaytoun and Canaan Fair Trade that reach international markets. Other interventions could include rooftop farming, small-scale health franchises, and certified midwives.

A third promising area for investment is the Palestinian information technology sector, which may be relatively impervious to strict Israeli limitations on Palestinians’ freedom of movement. Investment in the sector during the aid induced upswing of 2008-10 buoyed hopes. Since 2009, $78 million has been invested while IT grew from 0.8 percent to 5 percent of Palestinian GDP from 2008 to 2010 – albeit on modest revenue of $6 million.

Still, for the Palestinian economy this is a rare growth area dependent less on foreign aid than it is on private sector investment. American technology firm CISCO, which invested $15 million in the oPt, went so far as to say that “Palestine is on the brink of becoming the next high tech global hotspot.” Google's Gisel Kordestanipointing to Palestinian strengths in education and English-language skills says they could help “build something for the Arab world.”

However, even the IT sector is held hostage to the occupation. For example, Israel impeded the upgrade of Palestinian communications hardware necessary for an IT sector to flourish and does not provide frequencies for 3G services putting the mat a great competitive disadvantage. Moreover, there is the danger that Israeli companies will reap the lion’s share of the rewards, reinforcing unjust hierarchies of control that make growth impossible under occupation.A warning sign is that Israel itself is soliciting European donors for this sector.

Finally, there is the issue of doing no harm. Some of the same donors who fund Palestinian development also fund PA security collaboration with Israel and projects aimed at “normalizing” the occupation. They are now being challenged by the youth movement as well as by the Boycott, Divestment and Sanctions movement.

Some voices are calling on Palestinians to decline aid from nations that directly support Israeli military activities.

Beyond doing no harm, an alternative aid agenda would need political protection by donor agencies and their governments because it would pose a direct challenge to Israel’s colonial enterprise. The political clout of countries in Europe and North America would be essential for such an aid agenda. It would not (yet) involve bringing pressure to bear on Israel to actually end the occupation; it would simply mean enabling Palestinian development on their own.

Furthermore, an alternative model encompassing the kinds of policies and programs described above would have to be linked to a political process that secures Palestinian rights under international law. Otherwise donors are simply soothing the pain while Israel continues to colonize and dispossess the Palestinian people.


Nadia Hijab, AlaaTartir, and Jeremy Wildeman are, respectively, director, program director, and guest author of Al-Shabaka: The Palestinian Policy Network.

A version of this article first appeared on ForeignPolicy.com.

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