Earlier this year, the Trump administration sparked new hope in Ramallah with efforts to kickstart moribund peace negotiations but, despite several meetings between Palestinian and American officials, there is still no clear outline for negotiations. Also absent is the increase in aid to the Palestinian Authority (PA) that has traditionally accompanied revived peace expectations. In fact, the level of development and budgetary support provided to the PA is expected to fall this year.

International aid has played a crucial role in sustaining the humanitarian situation in the West Bank and Gaza, the Palestinian economy, and the PA’s operations since 1993. According to the World Bank, more than US$31 billion in international aid has flowed to Palestinians since 1993. Each and every infrastructure project or government institution in the West Bank or Gaza has significant international financial backing. But since 2013, aid disbursements in the form of development and direct budgetary support have fallen sharply. As illustrated in Figure 1, aid has declined from about $2.8 billion in 2008 to about $1.7 billion in 2016. Aid as a percentage of GDP is at its lowest level since the PA’s inception – now just 13%.

Earlier this year, the Trump administration sparked new hope in Ramallah with efforts to kickstart moribund peace negotiations but, despite several meetings between Palestinian and American officials, there is still no clear outline for negotiations. Also absent is the increase in aid to the Palestinian Authority (PA) that has traditionally accompanied revived peace expectations. In fact, the level of development and budgetary support provided to the PA is expected to fall this year.

International aid has played a crucial role in sustaining the humanitarian situation in the West Bank and Gaza, the Palestinian economy, and the PA’s operations since 1993. According to the World Bank, more than US$31 billion in international aid has flowed to Palestinians since 1993. Each and every infrastructure project or government institution in the West Bank or Gaza has significant international financial backing. But since 2013, aid disbursements in the form of development and direct budgetary support have fallen sharply.

Read the article in The Interpreter (produced by the Lowy Institute).

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