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French Version

Palestinian economy survivng despite Israeli intent

According to official statistics, the Palestinian economy has lost more than $5 billion since Al Aqsa Intifada...

THE ISRAELI occupation, among so many other things, seems determined to destroy the Palestinian economy. According to official statistics, the Palestinian economy has lost more than $5 billion since Al Aqsa Intifada began nine months ago. That figure almost equals the entire Palestinian GDP for 2000. The Palestinian National Authority (PNA) worked unflaggingly to build this economy over the past five years. Statistics indicated the Palestinian economy was set to make a 5 percent increase in its GDP. The Palestinian per capita income was also expected to grow by 3 percent. But this was before the Palestinian Intifada erupted. Despite the economic suffering these numbers reveal, PNA officials and Palestinian businessmen say their economy will survive in the end. “The Israelis still don’t believe in the Palestinians’ right to a strong, potent economy,” said Nidal Sukhtian, chairman of Munir Sukhtian Group. “Palestinians were wary of the Oslo peace accords. The current economic figures make clear that Palestinian interests are not being protected or even considered by the Israelis.” Sukhtian says this environment makes Palestinians even more determined to build their economy and fortify the business environment in the Palestinian territories. However, while Israel maintains control of the Palestinian economy Palestinians will continue to suffer. Israeli troops are cordoning off the Palestinian territories and obstructing trade between areas in the West Bank and Gaza Strip. They are restricting trade relations between PNA-ruled areas and Egypt and Jordan. Such restrictions have PNA officials fearing the death of the Palestinian economy. These increased restrictions come on top of rising poverty rates and unemployment suffered by Palestinians during the last 34 years of Israeli occupation. PNA’s industrial and commercial sectors have seen losses near 75 percent since the begining of the Intifada. “There are many Palestinian businessmen and investors making good profits inside and outside Palestine. This despite the hinderances their businesses suffer from Israeli occupation,” Sukhtian told The Star. “I believe the Palestinians are still capable of developing their economy by exploring new and different avenues.” One company exploring these avenues is the Palestinian Development and Investment Co. (PADICO). PADICO has become one of the most powerful Palestinain companies. The Nablus-based company began after the signing of the Oslo peace accords in September 1993. Its main objective was to develop the Palestinian territories economically and socially. The company operates profitably on both regional and international scales. “We are doing whatever is possible to help support the Palestinian economy,” Munib Al Masri, PADICO’s chairman, told The Star. “We believe this should be done by promoting investment in the Palestinian territories.” With $6.2 million in profit for 2000, PADICO’s businesses grew effectively in all fields. The company today has 10 associate companies that handle a wide range of industrial and commercial investments. Al Masri is certain the situation in the Palestinian territories will change for the better as long as the Intifada continues. “We have to be patient. Nothing can be done overnight. PADICO is a leading example to Palestinian businesses. It makes profits even under occupation,” stressed Sukhtian, also a member of PADICO’s Board of Directors. The company held its sixth ordinary session Sunday at the Jordan-Intercontinental Hotel to review its financial progress in 2000. PADICO’s $6.2 million in profits represents about 5 percent of its capital, valued at $129 million. The company also increased its revenues to $20.8 million, and assets to $186 million.

Abdel Majid Shoman, chairman of the Arab Bank and one of PADICO’s major shareholders, urged shareholders to be patient. Some shareholders were disappointed in the lack of dividends in 2000. Shoman explained that profits normally shared through dividends were being reinvested into greater development in the Palestinian territories. It is his belief that this will result in long term profits for all shareholders.

Sukhtian explained that the investment environment in the PNA territories have more potential than in any other Arab country. “Investments located in PNA-ruled areas can enjoy tax-free exports to US and European markets. The removal of customs taxes increases business profits.” explained the Palestinian businessman.

“There are no limitations on exports from Palestinian territories. This will encourage Arab and foreign business people to come and set-up their investments in Palestine.” Sukhtian called on members of the Palestinian Legislative Council to review PNA relations with other countries, including Arab nations. Sukhtian said the review must reflect the mutal economic interests of all countries involved. “Palestinian deputies in the Council should work to promote economic development in Palestine.” Presently Arab leaders have pledged $2 billion in financial support to the PNA. Only $270 million has been transferred to the PNA treasury thus far.

Ghassan Joha
The Star

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