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        United Nations Conference on Trade and Development
22 August 2005


Working Party on the Medium-term Plan
and the Programme Budget
Forty-third session
Geneva, 12–16 September 2005
Item 3 of the provisional agenda


Report by the Secretary-General of UNCTAD


*This document was submitted on the above-mentioned date as a result of processing delays.

A. Division on Globalization and Development Strategies


3. Special programmes

(a) UNCTAD’s assistance to the Palestinian people

18. Development context: UNCTAD’s programme of assistance to the Palestinian people in 2004 continued to suffer from the deteriorated conditions on the ground and the intensification of the conflict and economic crisis since 2000. Nonetheless, the Palestinian Authority (PA) and civil society remain focused on the objective of building the institutional set-up and infrastructure required for a functioning economy capable of responding to the national and international development efforts. Against this background, UNCTAD’s technical assistance programme in 2004 was guided by a framework to bridge present economic realities with long-term objectives, namely a framework to link relief, rehabilitation, reconstruction and development efforts.

19. Objectives/features: The programme supports the Palestinian people's efforts to develop capacities for effective economic policy-making and management, in accordance with the provisions of the United Nations Medium-Term Plan for 2002-2005, paragraph 35 of the São Paulo Consensus, and General Assembly resolutions 56/111 (paragraphs 6 and 7) and 43/178 (paragraph 9). The activities are coordinated with other international agencies to strengthen the institutional and managerial capacity of the PA in the areas of trade policy, competition, trade facilitation, financial and debt management, development planning, investment promotion and enterprise development. The programme also seeks to improve public, private and international institutions’ understanding of issues related to Palestinian development in the context of the multilateral trading system and to increase public awareness of issues related to UNCTAD's activities, research and analysis on Palestinian economic development.

20. Output/description of activities: During 2004, as in the previous three years, Israeli restrictive measures and the closure policy severely affected a number of UNCTAD's technical cooperation activities in the occupied Palestinian territory (oPt), especially in Gaza. Nevertheless, thanks to a highly selective and flexible mode of operation, it was possible to achieve some progress in the work programme. Following the completion of Phase I of the customs administration capacity building project (ASYCUDA), funding has been secured for Phase II and work commenced in 2004. In cooperation with the Palestinian Investment Promotion Agency (PIPA), work has also begun to implement an "investment retention programme". In the area of development strategies and trade policy, UNCTAD, in association with the International Labour Organization (ILO) and the Palestinian Economic Policy Research Institute (MAS), has started implementing the "Integrated Framework for Palestinian Macroeconomic, Trade and Labour Policy". Activities in support of small and medium enterprise (SME) development (EMPRETEC), which had to be interrupted in the second half of 2003 owing to funding shortfalls, can be expected to resume in 2005. Implementation of the project on debt monitoring and financial analysis capacity building (DMFAS) continued, as the Ministry of Finance operates the computerized system to produce detailed public debt data, which featured in the PA 2004 budget.

21. With a view to further strengthening strategic partnerships with other international agencies, UNCTAD participated actively in ESCWA’s Palestine Rehabilitation and Development Forum in October 2004. The secretariat also contributed to substantive preparations for the UNRWA Conference on Assistance to Palestine Refugees held in June 2004. At the request of the PA, in 2004 the secretariat provided advisory services in the area of trade policy (implications of possible alternative trade policy arrangements) and trade facilitation (establishment of the Palestinian Shippers Council). Furthermore the secretariat in cooperation with MAS held two workshops in Ramallah in April and November 2004 on the Palestinian economy fiscal, labour and trade policy and institutional frameworks.

22. Owing to lack of resources and switching of priority attention to urgent economic needs arising from the ongoing crisis, funding for a number of proposed project activities, requested by the PA, is still unmet. These proposed activities include: technical support to the PA National Task Force on Economic Development; improving food security through international trade; building national capacity for e-commerce; in-depth studies on border cargo management and export possibilities under a reformed border regime; capacity building for port management and institutional development; and reforming the Palestinian insurance sector. Furthermore, no funds have been identified to maintain core secretariat resources which were available to this work programme in 2001-2003 and had enabled the secretariat to respond effectively to its mandate of intensified assistance to the Palestinian people. Fulfilment of the mandate of the São Paolo Consensus and improvement of the programme's effectiveness would require more predictable availability of extrabudgetary resources to maintain core activities and further enhance the concrete progress towards its objectives.

23. Results: Despite the difficult conditions in the field, UNCTAD continues to successfully implement a diverse programme of technical cooperation with the Palestinian Authority (PA)/civil society, assisting it to develop its capacity and reform programme in several areas. Two secretariat reports on UNCTAD assistance to the Palestinian people were deliberated onwidely and noted with satisfaction by the Trade and Development Board. The majority of the Board members echoed the reports' key themes and stressed the need to increase support for assistance to the Palestinian people in UNCTAD. The impact of advisory services provided by UNCTAD, in response to the PA requests, is manifested in the fact that eight of the PA's policy papers/draft laws are being reformulated in response to, or drawing on, these services. The secretariat activities, in the areas of technical cooperation, research and analysis, and training, continue to have a positive impact on PA policy-making and capacity in the area of customs, debt management, trade facilitation, private sector development and economic analysis and management. The selective and flexible mode of operations adopted by the secretariat in the past three years has effectively produced tangible results. This is reflected in the integration of UNCTAD's ideas and adoption of its recommendations at various levels, building of institutional, technical and human capacities, and the enrichment of public debate on related policy issues. The secretariat activities have helped the PA to maintain the focus on work on key institution-building projects, while addressing the urgent relief needs generated by the ongoing crisis.


205. Outputs/results:


218. Assistance to the Palestinian Authority: Following a contribution from the Government of Norway to support this project, UNCTAD prepared a needs assessment survey. This was to be used by the Palestinian Investment Promotion Agency (PIPA) to conduct a survey of its clientele - foreign and domestic investors, as well as local firms seeking foreign investment. The survey results will underpin an investment retention strategy, which, along with capacity building activities, is the principal objective of the project. The collection of survey responses by PIPA is designed as a “learning-by-doing” exercise. The database will be used by PIPA as a valuable resource in its investment promotion and business linkages activities.


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