Palestine needs $1.62b in annual foreign aid to close deficit: WB

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RAMALLAH, West Bank, Sept 19 (AFP): The Palestinian economy remains crippled seven years after the outbreak of the intifada and needs 1.62 billion dollars in annual foreign aid to close the deficit, the World Bank said in a report obtained by the news agency yesterday.
"Per capita GDP (gross domestic product) in the Palestinian territories now stands at 1,129 dollars (814 euros), about a third less than its level in 1999," according to the report to be presented to an international donor organisation at a meeting later this month in New York.
"GDP is being increasingly driven by government and private consumption from remittances and donor aid, while investment has fallen to exceedingly low levels, leaving little productive base for a self-sustaining economy."
As the Palestinian private sector has withered due to Israeli measures in the wake of the intifada and the rise to power of Hamas, including restrictions on movement, thousands are flocking to the beleaguered public sector.
"With few options at its disposal, and despite an unsustainable wage bill, the PA (Palestinian Authority) has resorted to absorbing workers as a way to alleviate poverty," the report said.
"As a result, public sector employment has grown by 60 per cent since 1999 and by 2006 stood at about 157,800.