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IMF sees weak 3.5% GDP growth in Palestine

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Staff writer ▼ | February 13, 2016
Palestine
Middle East   The economy of the West Bank to grow 3.3%

Palestinian authorities have successfully managed the national budget and decreasing donations over the past few years.

However, Palestine still struggles with lack of resources, high unemployment and weak revenues, said the International Monetary Fund (IMF).

The Fund expects the economy of Gaza and the West Bank to grow 3.3% this year, with Gross Domestic Product (GDP) going up some 5% in Gaza and less than 3% in the West Bank.

In the next few years, the Fund sees 3.5% GDP growth – not enough to fight unemployment or improve the population’s income. Additionally, uncertainty and restrictions enforced by Israel prevent the economy from thriving, the press release states. The IMF believes Gaza will not return to pre-conflict development levels before 2018.

Palestinians have successfully managed their scant finances in a year that saw a “sharp drop” in donor aid, whose results include high public debt arrears.

The Fund warns that authorities must be prepared to support the banking system if the need arises.

On the other hand, it acknowledges that the recently approved money laundering and terrorism financing law shows the country’s commitment to protecting its economy and adhering to best economic practices.


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