Israel's Economic Stranglehold on Palestine: An Overview
The ongoing Israeli occupation has intensified its grip on the Palestinian economy, particularly in the West Bank and Gaza Strip, through a series of legislative measures that have far-reaching implications for Palestinian livelihoods. Recent studies reveal that these laws, enacted after the escalation of conflict in October 2023, have exacerbated existing economic challenges, intertwining the fates of both economies in a complex web of dependency and control.
Key Legislative Changes Impacting the Palestinian Economy
A comprehensive study by Dr. Raghad Azzam from the Vision Center for Political Development highlights several critical laws that have been introduced, significantly affecting various sectors of the Palestinian economy. One of the most impactful measures is the ban on the United Nations Relief and Works Agency for Palestine Refugees (UNRWA), which has historically provided essential services to over 4 million Palestinians. The cessation of UNRWA's operations is expected to increase the demand for humanitarian aid, as the agency's budget of $345 million in 2023 was crucial for supporting Palestinian refugees.
Additionally, the Israeli government's Economic Arrangements Law for 2025 has eliminated tax deductions for foreign and Palestinian workers in the occupied territories. This change is projected to raise tax revenues by approximately 410 million shekels ($113 million) but will also impose a heavier financial burden on Palestinian workers, further exacerbating unemployment rates in the region. The number of Palestinian workers in Israeli markets has plummeted from around 200,000 to just 27,000 since the conflict escalated, leading to increased economic distress.
Moreover, the Israeli Knesset has passed laws that freeze Palestinian Authority funds, which are crucial for public services and welfare. The freezing of approximately $789 million in tax revenues, justified by claims of supporting terrorism, has severely restricted the Palestinian Authority's financial capabilities. This situation is compounded by new laws allowing Israeli families of victims of resistance operations to sue the Palestinian Authority, further straining its financial resources.
The legislation also includes measures to stop social benefits for individuals deemed to have participated in activities labeled as “terrorist” under Israeli law, affecting vulnerable populations, including minors and disabled individuals. This move is seen as part of a broader strategy to exert economic pressure on Palestinians, undermining their capacity for resistance and survival.
In summary, the recent Israeli laws and actions represent a systematic approach to tighten economic control over the Palestinian territories, leading to a significant deterioration in living conditions and economic stability for Palestinians in both the West Bank and Gaza Strip.
