Afternoon Tea in Jerusalem Blog

In addition to my work as a business coach, one of my interests is blogging about life in Israel. This is a country full of contrasts – over eight million citizens living in an area the size of Wales. You can see snow and the lowest place on the globe in the same day. Although surrounded by geopolitical extremes, Israel has achieved a decade of high economic growth. My work brings me in contact with an array of new companies, exciting technologies and dynamic characters. Sitting back with a relaxing cup of strong tea (with milk), you realise just how much there is to appreciate in the Holyland. Large or small operations, private sector or non profit, my clients provide experiences from which others can learn and benefit.

However you look at it, the Palestinian economy is not very strong. It is easy and convenient for outsiders to hoist the blame on Israel. And whenever a Palestinian leader meets a Western counterpart, the resulting press release almost always refers to a request for foreign aid.

I have often tested the fallacy of this argument by citing an IMF report that shows how under Israeli rule, the joint economies of Gaza and the West Bank were one of the best performers from 1968 to 2000 – 5.5% per annum on average. It now appears that there is a second fallacy. Despite popular belief, while Europeans pour their taxpayers money into the Palestinian economy, there is a relatively poor parallel response from members of the Arab League.

My starting point is a comment reposted on the LinkedIn page of the ‘Economist’ magazine. According to a Malaysian expert, Prof. M. Aslam Haneef,  “The total amount of charities and gifts that are coming from the Muslim world is 15 times more than the total of the UN aid package.” A bold statement, which I am not able to challenge.

And then I read a commentary from the Gladstone Institute. Mainly through UNRWA, yes a UN body, “the Palestinian people have received per capita, adjusted for inflation, 25 times more aid than did Europeans to rebuild war-torn Western Europe after the Second World War.” UNRWA’s budget in 2012 exceeded a staggering US$900 billion.

The USA, EU, UK, Sweden, Norway, Germany, The Netherlands and Japan pay $644,701,999, or 71% of the annual UNRWA budget.

So where do the Muslim states rank? First in, at #15, is Saudi Arabia. The land of palaces and private gold leaf painted Airbus A380’s on the Royal runways chipped in $12,030,540 — less than half of a tiny country such as the Netherlands. Second, at #18, is Turkey, the supposedly economically flourishing state of a prime minister who zealously supports Hamas, but which contributes only $8,100,000. Qatar, which stands accused of paying millions in bribes to win the bid to host the 2022 World Cup, and is now spending millions on the construction of high end soccer stadiums, contributed exactly $0 to its Palestinian brothers in faith.

Seeking to move beyond the sarcasm, I checked out the ‘economy page‘ of the Ma’an News Agency, based in Ramallah. Of the twelve leading items, six refer to pleas for overseas aid. Of these, only one connects to an Arab source, a Saudi contribution ‘to develop sewage refineries’ (sic), while the rest are the USA, EU and…..well the story begins to repeat itself.

In the private sector, the situation is not much different. One of the few genuine venture capital groups in Ramallah is Sadara, which recently raised US$30 million. From whom? “Google, the investment fund of George Soros, the European Investment Bank, the Skoll Foundation and the Case Foundation. The software giant Cisco has invested $5 million.” Again, no prizes for observing who is not listed.

The Palestinians need financial help. No argument. Assumedly, they would reap greater rewards from current donors if they could improve their transparency and accountability. Meanwhile, you have to ask, what is it that the Arab block knows, which forces it not to invest in the Palestinian economy?

4 comments

    1. I understood that they never gave. That said, over the past two decades, the members of the Arab League have promised much but delivered very little. Info is available allover Google, starting with the speeches of former Paleatinain Prime Minister Fayad.

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