World Bank grants PA $40 million to support reform
Published Wednesday 21/05/2014 (updated) 21/05/2014 19:26
BETHLEHEM (Ma'an) -- The World Bank on Tuesday announced that it had approved a $40 million grant to the Palestinian Authority to support "strategic reform priorities" focused on public finances and improving the Palestinian business environment.
The UN-linked international financial institution said in a statement that it would be issuing the grant in order to "improve the PA's fiscal position, build robust public financial management systems and improve access to finances for Palestinian enterprises," adding that it "will contribute to building the institutions of a future Palestinian state."
"Implementing fiscal and economic reforms and maximizing the efficient use of resources helps the government be more responsive to the needs of the people and increases confidence in the institutions -- resulting in a vibrant society with social equity," Steen Lau Jorgensen, World Bank country director for West Bank and Gaza, said in the statement.
The institution highlighted that the grant was being offered in the context of the "the current stalemate in the peace process and the decline of economic growth and donor aid," and that it was intended to "ease some of the PA's fiscal stress."
The grant is the sixth in a series totaling $240 million, the statement said, adding that these funds are supplements by an additional $200 million in yearly donor support towards the reform agenda.
The World Bank has in the past highlighted the negative effects of the Israeli occupation on Palestinian growth, including an October report that said that Israel's control over Area C -- 61 percent of the West Bank -- deprives the Palestinian economy of an estimated $3.4 billion a year.
The report added that its return would increase government revenues by $800 million and reduce its reliance on financial aid, which is one of the highest rates in the world.
Frequent Israeli withholding of tax-receipts as well as broader control over all access points in and out of the West Bank means that Israel maintains almost complete control over Palestinian imports and exports, while the Palestinian domestic market remains captive to Israeli products making domestic distribution for Palestinian companies difficult as well.