The World Bank vs. Israeli settlements

The World Bank has a reputation for integrity and objective professional analysis which it’s new report calls into question.

 World Bank President Jim Yong Kim 370 (photo credit: REUTERS)
World Bank President Jim Yong Kim 370
(photo credit: REUTERS)
A newly-released report issued by the World Bank’s office for the “occupied Palestinian territories” charges that “Israel’s occupation costs the Palestinian economy $3.4 billion each year.” That claim has certain logic. The more the PA gets, the greater their wealth; one side’s gain is the other’s loss. Tel Aviv would be better, but that also doesn’t belong to them.
The purpose of this report seems to be to raise economic and financial claims against Israel which imply deceit and theft, thereby shifting blame for the PA ’s problems to Israel.
To understand why the new report was issued, one must compare it with a more comprehensive World Bank report issued in 2012 which described the PA ’s economy as a failure, “unsustainable” – not so much because of Israeli security restrictions, but due to inherent flaws and rampant corruption within the PA itself.
The 2012 report, Towards Economic Sustainability of a Future Palestinian State: Promoting Private Sector-Led Growth, analyzed the PA economy critically, upsetting Palestinians and their supporters, and challenging their portrayal as victims of Israeli policies.
The new report takes it a step further: it’s not what PA residents produce or don’t produce, but how much more they could produce if Israel would give them more land, resources and economic opportunities.
Using biased hypotheses, questionable statistics and faulty methodology the new report lacks critical analysis.
For example, the report claims Israel is responsible for environmental pollution in Area C, but fails to note that the PA refuses to join projects which would resolve the problem and benefit everyone – since that would imply recognition of Israel. World Bank reports do not evaluate or even estimate the PA ’s substantial black market economy – which would drastically change the data.
The report ignores the main issue impacting Palestinian economy and society: terrorism. Not a word about the cost of sabotage, arson and widespread theft (especially livestock and cars) by Palestinians. The report assumes it’s all Israel’s fault. The report charges that Israel does not provide Palestinians with adequate amounts of water and electricity. An old charge, it has been thoroughly refuted. Moreover, the report does not include thefts of water by Palestinians, or their refusal to pay for utilities supplied by Israel.
The report notes that the PA ’s share of the market in quarried stone, their largest export item, would expand if Palestinians were given access to Area C. No mention is made of vast illegal quarrying in Areas A and B, or the ecological damage that results.
The report faults Israel for high unemployment rates among PA residents, but does not verify the accuracy of the figures and ignores large numbers of Palestinians who work legally and illegally. The report does not analyze the effect of large amounts of direct foreign investment which support Palestinian projects in Area C and areas under PA control.
According to the report, Area C contains “around 180,000 Palestinian people.” This figure is based on unverified information from Bimkom, a pro-Palestinian NGO, and the Palestinian Central Bureau of Statistics, which lists the population of 149 villages in Area C as 47,360. Where are the rest? Since nearly all sources used by World Bank reports are based on unreliable Palestinian and anti-Israel organizations and NGOs, the conclusions are predictable. For example, reports of poverty among Palestinians are inconsistent with widespread luxury building, but never questioned.
According to the report, “Area C includes almost all the land of the West Bank suitable for agricultural production.”
No reliable sources are cited, it contradicts high agricultural production figures for Areas A and B, and is refuted by simple observation. Because of thefts and “the occupation,” the report asserts that Palestinian communications and banking monopolies cannot provide services and expand, but fails to indicate who is responsible for theft and violence. The report suggests that if Israel gave up Area C, the situation would improve.
OR NOT . The PA ’s real problems, according to the World Bank’s 2012 report, are internal: “It is unlikely that even with significant growth the PA will be able to support an administration of the current size.
“The PA has become increasingly dependent upon donor assistance to fund its basic operations. This not only leaves it vulnerable to reductions in aid, but also means that the PA has few resources to devote to long-term development issues.”
“The PA ’s pension system is one of its largest obligations; it is insolvent and effectively operating as a pay-as-you go system... the (entire) system is in crisis.”
“The largest share of (PA ) government expenditures goes to wages and salaries, which... is more than the total projection of budget support and 21 percent of estimated GDP.”
Although intended to help the PA , reports that distort the problems in order to advance a political agenda cause more harm than good. But that’s a World Bank tradition. They backed Israel’s evacuation of the Gaza Strip and Northern Samaria, wasting billions on a fantasy which became a nightmare.
The World Bank has a reputation for integrity and objective professional analysis which it’s new report calls into question.

The author is a PhD historian, writer and journalist.