Question of Palestine home || Permalink || About UNISPAL || Search

Follow UNISPAL RSS Twitter

Source: United Nations Special Coordinator for the Middle East Peace Process (UNSCO)
31 December 2008

Since 1996 UNSCO has continually monitored and reported on socio-economic conditions in the occupied Palestinian territory and in the process established an extensive socio-economic database. UNSCO does not create raw data but rather uses available data which, in the occupied Palestinian territory is relatively abundant. However, the data that is available tends to remain dispersed and is not always automatically shared between institutions. The objective of the database is to bring together in one place a wide variety of data on socio-economic conditions and by doing so present a broader, more detailed perspective on socio-economic conditions. The purpose of this report is to: 1) broaden the access to this database through publication of the most recent data gathered; and 2) provide readers with up to date information on socio-economic conditions in the occupied Palestinian territory.

The report is divided into three sections:

Section 1 consists of a one-page fact sheet which provides a snapshot view of the socioeconomic situation of the current and previous reporting period and for reference purposes provides base line figures for the period just prior to the outbreak of the second Intifada.

Section 2 and 3 report on the Macro-economic and the Private sector and banking modules of the UNSCO database. They provide data on the last six reporting periods for each indicator as well as base line data. In addition, some initial analysis on observed trends is given below each table.

1 For a more detailed report on sections C (Macro-economy) and D (Private sector), see data below.
2 CPI Base year 2004 = 100
3 MoNE data does not include aggregates or aid flows in Aug 2000.
4 * Please note that data for Q2-2008 has been adjusted by the PMA for all bank credit categories.
5 Adjusted unemployment is calculated by adding discouraged workers (i.e. unemployed but no longer seeking work) to the ILO
6 Effective closure days are calculated by adding all days when a crossing was fully or partially closed excluding weekend and

For further information please contact: Ramallah: Bushra Mukbil; Gaza Strip: Raed Raqeb

The exchange rate between the US dollar and the NIS has slightly decreased in December, 2008.

Volume of registered fuel sales in the Gaza Strip significantly dropped in December 2008. Benzene 95 and Gasoline were imported for UNRWA, and Zero fuel for the private sector. This is due to the closure of Gaza border crossings. It is worth noting that some Gasoline was available, most likely as a result of smuggling.

The Palestinian CPI figures declined by 0.52 percent in the oPt in December 2008. The CPI for the West Bank decreased, by 1.49 percent and by .09 percent for the Gaza Strip. Minor increases were recorded for the oPt in Textiles, clothing and footwear, Furniture and households, recreational cultural goods and services, while declines were seen in food and soft drinks, alcoholic beverages and tobacco, and transportations.

Truck movement to Gaza has been restricted to humanitarian supplies since 12 June 2007. Exports were stopped altogether at the same time except for limited agricultural exports. December 2008 data indicates a significant decline in the total of imported truckloads to the Gaza Strip since
October 2008, by approximately 68 percent. No cement or gravel was allowed in, and only 260 trucks of wheat and animal feed were imported through Karni. Of the 594 trucks imported through Kerem Shalom, 297 were humanitarian trucks for UN agencies, and 297 trucks for the private

For further information please contact: Ramallah: Bushra Mukbil; Gaza Strip: Raed Raqeb

The number of new companies registering is used as a proxy indicator for the vitality of the local economy as well as the ability of the local economy to create new employment. New company registrations in the West Bank decreased in December 2008, by 6%. However, if compared to pre-Intifada levels, new company registrations have significantly dropped by approximately 59%. As for Gaza, figures from the Ministry of Economy in Ramallah show that the number of new company registrations has remained at zero, while data from the authorities in Gaza indicate 13 new
registered companies for December 2008. If considering data from authorities in Gaza, then figures for newly registered companies in Gaza have decreased by 35 percent, when compared with November 2008.

Similar to new company registrations, the area licensed for new construction is also used as a proxy indicator for economic vitality. Areas licensed for new construction increased in the West Bank and declined in the Gaza Strip. If compared with November 2008, areas licensed for new construction for the West Bank considerably increased by approximately 70.5%. The reason for the large increase in construction as suggested by the data for December is that all non-completed construction are resubmitted for licenses by year end to ensure that new licenses will be issued for the next year.

If disaggregated by type, and if compared with Q2-2008, it appears that in Q3-2008 non-residential and residential construction increased in the oPt by 38% and 16.7%, respectively. It is worth noting that there is no data available for Gaza due to the closing of the PCBS office in Gaza.

Data on bank credit is used as a proxy indicator for economic progress (increasing use of bank credit, particularly in the main productive sectors) or decline (decreasing use of bank credit). The Palestine Monetary Authority provides adjusted data once every three months. In relative terms,
general trade and Real Estate and Lands show an increase in the use of credit. Bank credit to the public sector also indicates an increase of approximately 6.2% in Q3-2008 when compared with Q2-2008. (Please note the PMA has adjusted the indicators for bank credit by economic activities starting Q1-2008. Due to such significant changes, current trends cannot be compared to those prior to 2008.)

Disaggregating bank credit by the type of credit, the data shows an increase in both loans and bank overdrafts. Loans currently represent 61.4 percent of all credit extended compared to only 41% in the pre-Intifada period.

Disaggregating bank credit by borrowing entities shows that consumer lending has increased in the third quarter of 2008. Compared to pre-intifada levels, consumer borrowing has slightly decreased, by 5%.

Bank deposits for the third quarter in 2008 indicate an increase in both private and public sector deposits. Compared with the second quarter of 2008, total bank deposits in the third quarter of 2008 have increased by 4.66 percent.

In a functioning economy, an increase in the loans versus deposits ratio is perceived as a positive sign, as monies are not saved but invested or consumed, each of which is a stimulant for the economy. Since September 2006, this ratio has steadily declined in the oPt signaling little optimism
in the prospects for the Palestinian economy, which limits appetite for domestic investment and thus increases deposits. The sharp drop in the second and third quarters signals heightened concern with regard to overall economic performance.

Similar to bank credit and deposits, data on the Palestinian stock exchange is used as a proxy indicator of Palestinian perceptions vis-à-vis the state of the national economy. Data for December 2008 shows a decrease in trade at the stock exchange both in terms of value and number of stocks traded. The Al-Quds index slightly increased by approximately 4% in December 2008.

Follow UNISPAL RSS Twitter