The World Bank on Thursday approved a new four-year strategy for Palestine that puts emphasis on protecting lives and creating new job opportunities for its people amid the coronavirus pandemic.
“Due to the persisting fragile context, exacerbated by the Covid-19 pandemic, resilience strengthening is needed immediately,” Kanthan Shankar, World Bank country director for West Bank and Gaza said. “The new World Bank strategy will act to protect lives and livelihoods and put the jobs agenda at the forefront of its strategy.”
Palestine’s economy had one of the sharpest contractions on record in 2020 and only a modest recovery is expected this year as its overwhelmed healthcare sector struggles to control the spread of the virus.
The economy shrank by 11.5 per cent last year and is only expected to grow by 3.5 per cent this year as social distancing measures affect growth in sectors such as tourism, restaurants and construction, in addition to denting the prospects of workers that depend on jobs in Israel, the World Bank said earlier this year.
The World Bank also said the government’s fiscal deficit is over $1 billion after aid – the highest in years – and the declining government revenues “depresses investment and squeeze out urgent spending.”
“The programme will continue to strengthen the Palestinian resilience in times of crisis and provide relief and recovery, including through the emergency social protection and cash-for-work programmes,” it said.
“The social response will aim to enhance workforce resilience and capability for better employment through improving quality of education and health. It will increase its support to SMEs and start-ups for job retention and business continuity.”
The strategy will help champion a “well-connected Palestine” to become more integrated into the regional and global markets and develop regional trade, especially energy trade.
The lender’s strategy will also aim at strengthening the local government units’ financial sustainability and capacity to deliver services.
“More than 36 per cent of youth are unemployed in the Palestinian territories, particularly high in Gaza with 66 per cent and as high as 91 per cent for women,” Mr Shankar, said. “The new strategy sees the digital economy as a means of securing significant economic opportunities for young people and leading to a more engaged society.”
Earlier this month, the World Bank granted an additional $9 million to the ongoing Innovative Private Sector Development Project in Palestine to support start-ups and small and medium enterprises through financial and technical assistance. It also approved a grant of $20m to improve access to high-speed broadband services in Palestinian territories last month.