The Economy of the Palestinian Territories - Explaining the Anger Against the Oppressors

With the latest iteration of violence between Palestinians and Israelis focussing the world's attention on the Middle East, I thought that it would be a prudent exercise to better understand why Palestinians have become increasingly angry at their oppressors.  It is quite clear that they are being economically punished by Israel which continues to limit the development of the economies in both the West Bank and Gaza.  In this posting, we'll look at a selection of economic data from both areas with the hopes that we can all better understand the geopolitically complex nature of the ongoing violence.

 

According to data from the World Bank, we find the following key economic indicators for the West Bank and Gaza combined:

 

Population (2022) - 5,043,612

 

Population Growth (annual percent in 2022) - 2.4 percent

 

GDP in US dollars (2022) - 19.11 billion

 

GDP per capita in US dollars (2022) - 3,789.3

 

GDP Growth (annual percent in 2022) - 3.9 percent

 

GDP per person employed (constant 2017$ in 2022) - 28,277

 

Unemployment (percent of total labour force in 2022) - 25.7 percent

 

Labour Force Participation Rate (2022) - 44 percent

 

Employment to population ratio (aged 15+) - 33 percent

 

Population living in slums (percent of urban population in 2020) - 20 percent

 

Life Expectancy at Birth (2021) - 73 years

 

Refugee Population (2022) - 2,454,258

 

Poverty Headcount Ratio (2016) - 0.5 percent

 

The near-blockade of the Gaza Strip since 2007 by Israel has led to a far worse situation for Gaza residents compared to their West Bank peers.  According to the World Bank's September 2023 publication, "Racing Against Time", the Palestinian economy slowed during the first months of 2023.  While the economic activity in the West Bank rose by 4.3 percent in Q1 2023, the Gaza economy contracted by 2.6 percent due to worsening performance in the agricultural, forestry and fishing sector with the fishing sector experiencing a 30 percent decline after the Government of Israel restricted the sale of Gazan fish in the West Bank in August 2022.

 

Here is a graphic comparing the economic growth of the West Bank to Gaza:

 

While Palestine saw its overall unemployment rate rise marginally from 24.4 percent in 2022 to 24.7 percent in Q2 2023, Gaza's unemployment situation was far, far worse than the West Bank's:

 

West Bank:

 

2022 - 13.1 percent

 

Q2 2023 - 13.4 percent

 

Gaza:

 

2022 - 45.3 percent

 

Q2 2023 - 46.4 percent

 

Here is a table showing labour market statistics for Gaza, the West Bank and the Palestinian Authority as a whole for Q2 2023:

 

What is most shocking is the level of youth employment in the Gaza.  At 59.3 percent, it is completely understandable why there is such anger among young Gazan males at their political masters who have essentially destroyed their hope for a positive and even modestly prosperous future.

  

Let's close this posting with a look at the same economic data for the state of Israel, the nation which is crushing the Palestinian economy:

 

https://data.worldbank.org/country/israel

 

Population (2022) - 9,550,600

 

Population Growth (annual percent in 2022) - 2.0 percent

 

GDP in US dollars (2022) - 522.03 billion

 

GDP per capita in US dollars (2022) - 54,659.8

 

GDP Growth (annual percent in 2022) - 6.5 percent

 

GDP per person employed (constant 2017$ in 2022) - 100,222

 

Unemployment (percent of total labour force in 2022) - 3.5 percent

 

Labour Force Participation Rate (2022) - 64 percent

 

Employment to population ratio (aged 15+) - 61 percent

 

Population living in slums (percent of urban population) - no data

 

Life Expectancy at Birth (2021) - 83 years

 

Refugee Population (2022) - 1,207

 

Poverty Headcount Ratio (2016) - no data

 

Israel has nearly twice the population of Palestine but its GDP is 27 times larger, its GDP per capita is 14.4 times larger and its GDP per person employed is 3.5 times larger.  Palestine's unemployment rate is 7.3 times higher and Gaza's is 12.9 times higher while the West Bank's is "only" 3.7 times higher.  To top it off, Palestinians have a life expectancy that is 10 years shorter than Israelis. 

 

While you are watching the mass media coverage of the latest hostilities between Israel and Palestine, I think that it would be prudent to keep the data that I have presented in this posting in mind as it goes a long way to explaining the anger in the streets of Palestine and why its citizens are expressing their outrage at their decades-long oppressors.

When you treat people as though they are subhuman and not worthy of respect for decades, I'm not sure why Israel's leadership is shocked at how Israel is now being treated by Palestinians.  What is most ironic is that Nazi Germany widely regarded the Jews as "untermenschen", with Jews being the lowest race of humans after Slavs and Roma.  You'd think that lessons would have been learned from history but apparently not.