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Israel halted the transfers, amounting to about $120 million a month, beginning last November in reprisal for the P.A.’s successful bid then for Palestinian statehood recognition at the United Nations. Israel saw the bid as a unilateral move that violated Israeli-Palestinian peace agreements.
Asked what sense the Israeli revenue cutoff made, one foreign ministry official said to the Forward: “Are you a parent? It’s called reinforcing behavior. I don’t want to sound paternalistic here. But there has got to be some price for their conduct.”
The ripple effect of missed salaries is easily discernible at small businesses throughout the West Bank. Shuleh, wearing a jacket and scarf inside his frigid store, says sales are less than half of what they were at this time last year. The reason, he explained, is the disruption in salaries of the P.A.’s teachers, doctors, secretaries, bureaucrats and other workers. It’s a convulsion particularly weighty in Ramallah, the seat of the P.A.’s government.
“People don’t want to spend the little money they do have,” he said. “They fear future times will be even worse.”
Economic distress is nothing new for Palestinians; their economy has always been subject to the vicissitudes of the conflict with Israel and of Israeli-imposed constraints on the movement of people and goods.
Even the electromagnetic spectrum is controlled by Israel, something that has stunted the growth of Palestinian telecommunications. Israel’s control of water resources has similarly limited the growth of Palestinian agriculture. But with Israel’s targeting of the P.A.’s salary regime, the minimal safety net is now being lost.
Hisham Awartani, an economist who was trained in the United States and teaches at an-Najah National University, in Nablus, said that Palestinians in the West Bank are currently going through the worst economic crisis since the launch of Palestinian self-rule in 1994.
In the past, he said, the P.A. salaries, which are estimated to directly support one-fourth of the population, constituted a monthly “blood transfusion” for the economy.