13:43, 03-Jan-2018
Palestine's Economy: International aid plays major role in state's finances
[]
Share
Copied
The economy of the State of Palestine has faced severe challenges due to Israel's closure policy.
Estimates predict the fiscal deficit for 2017 will increase to 1-point-35 billion US dollars, or about 10 percent of its GDP. Foreign aid fell to about 640 million US dollars, leaving a financial gap of over 700 million dollars.
Agriculture, international aid and remittances contribute greatly to Palestine's finances.
Agriculture is the mainstay of the economy. It helps feed the population and drives Palestine's exports.
International aid has also played a major role. The Palestinian National Authority in the West Bank and Gaza Strip receives one of the highest levels of aid in the world. The United States and the European Union are the largest contributors, donating about 50 percent of the total. The Arab nations and several international institutions also contribute a lot.
At the same time, the remittances from an estimated one million Palestinian emigrants serve as a vital lifeline for family members still in the West Bank and Gaza Strip.