Contrary to what many in the US or Europe might expect, Palestine’s economic prospects in the West Bank, Gaza and East Jerusalem may be better off after the end of the nine-month-long ‘peace’ talks involving US Secretary of State John Kerry and Tony Blair, the Middle East envoy for the EU, the US, the UN and Russia. For starters, the rapprochement between the Palestinian Authority in Ramallah and Hamas in Gaza could open the way to the long delayed exploration of the offshore Gaza oil and gas fields in the Mediterranean. Plus the agreement, announced last December, to build a new power plant in Jenin, in the West Bank, also powered by Mediterranean gas, will, at last, go ahead.
The publication in the past few weeks of Tony Blair and the Quartet’s Initiative for the Palestinian Economy (IPE), Beyond Aid, — a forward looking development plan for the private sector sponsored by Palestinian corporates, including PalTel, PADICO and the Bank of Palestine, plus the announcement at the World Economic Forum last year of a joint Palestinian-Israeli initiative, Breaking the Impasse, to link the most innovative private sector businesses on both sides of the divide, has already set the stage, and stretched the possibilities, for much more foreign and private sector direct investment, despite the Israeli recalcitrance. So, while share prices on the Palestinian Stock Exhange have suffered significant declines in April, foreign institutional investors have been buoyed by announcements of impressive dividends from the Exchange’s leading companies. The Bank of Palestine, for example, on 25 April agreed to distribute 8.33 per cent cash dividends and 6.66 per cent stock dividends for the year 2014. Paid up capital increased by $160 million. PalTel, another leading company on the Exchange, reported net income up by 12 per cent in the first quarter, despite the lack of progress in the ‘peace’ talks.
We’ll be reporting on all this in May, plus the dilemmas now facing key donors to the Palestinian Authority, including the EU, the US, Japan and the Arab countries. And, of course, we’ll be tracking the budget crunch that the PA can expect as a result of Netanyahu’s squeeze on its custom revenues. As always, watch this space. And, thanks for reading, Pam © Pamela Ann Smith This is a publication of investpalestine.wordpress.com and is protected by international copyright laws. This article is for the reader’s personal use only, but may be re-distributed electronically with a credit to investpalestine.com.