The boycott includes a freeze on aid money to the PA, which has cut its budget by about 35 percent, according to the report, and has made paying employees a difficult task, leading to prolonged public sector strikes and a breakdown of services.
One aid worker commented that in addition to the PA’s growing inability to conduct state roles and services, international investments in PA institutions over the years are now "going to waste” as projects are being frozen.
Furthermore, unemployment in oPt remains high, as about 40 percent of adults are without work. The Palestinian GDP dropped by more than 40 percent since the renewed outbreak of violence in September 2000.
This has made more Palestinians dependant on aid at a time when aid agencies are struggling to raise the required funds to meet the needs of oPt residents.
Filippo Grandi, UNRWA’s deputy commissioner-general, recently said that he expects to receive less than half of the US $250 million his organisation has asked for in its 2007 emergency appeal for the West Bank and Gaza Strip.
Intense Israeli military action
In addition to intense Israeli military action in the second half of 2006, which left 505 Palestinians dead and many more injured, the military has also tightened restrictions on movement, the report says, leading to further economic decline.
The Israeli system of checkpoints and travel permits "has made travel between different areas of the West Bank more difficult, effectively cutting the territory into three”.
"The [Palestinian] economy is almost completely devastated," Karen AbuZayd, commissioner-general of UNRWA, said last week while in Brussels trying to raise funds.