The costs of Israeli occupation

Mahmoud ElKhafif
Sunday 7 Jul 2019

No “Deal of the Century” is possible without a full and comprehensive assessment of the economic and financial toll of Israel’s decades-long occupation of Palestinian territories

Long decades of arbitrary Israeli policies have inflicted enormous economic costs on the Palestinian people. Since the first moments of the occupation, Israel (the occupying power) has imposed its hegemony on all sectors of the Palestinian economy and practiced daily measures to deprive the Palestinian people of their land, water and natural resources and destroy their homes and properties.

The economic damage caused by the occupation has become a daily ritual that the Palestinian people have to live with. At the same time, Israel is relentlessly expanding its internationally illegal settlements on Palestinian land, and the enormous cost of occupation for the Palestinian people accumulates over time.

However, to this moment, all these historical and emerging costs have not been estimated or documented in a systematic and comprehensive reference.

Therefore, there is no urge that may compel Israel to assume its responsibility, as the occupying power, under international law. On the contrary, Israel intensifies its arbitrary measures to increase the economic cost of occupation for the Palestinian people and deals with the whole issue with indifference.

For this reason, the UN General Assembly, in the last five years, adopted five consecutive resolutions (20/69, 12/70, 17/20, 72/13 and 73/18) requesting the United Nations Conference on Trade and Development (UNCTAD) to estimate the economic costs that the Palestinian people incurred because of the Israeli occupation and document these costs in reports to the General Assembly.

In 2016 and 2018, UNCTAD prepared two preliminary reports (A / 71/174 and A / 73/201), in which the economic dimension of the occupation is described as acts by the occupying power that aim at confiscating the properties, natural resources and economic benefits of the people under occupation.

Costs of occupation also arise from measures by the occupying power that restrict the ability of the people under occupation to: use their natural resources; reach their place of work; move freely in their own homeland; and conduct commercial and economic dealings with their neighbours and trading partners.

What is even more harmful is that these measures reinforce economic dependence not only on the present generation but also on future generations, by depriving them of the most essential human rights, including the right to development, right to work, right to education, safe drinking water, food security, unpolluted environment and many other basic economic human rights.

The Israeli measures are designed to erode the productive sectors and to distort the structure of the economy of the occupied Palestinian territory.

In the last four decades the share of agriculture and industry in GDP declined by more than half, from 37 percent to 16 percent, while their contribution to employment dropped from 47 percent to 20 percent.

The occupation authorities do not allow Palestinian producers to access Palestinian territories in Area C, which represents more than 60 percent of the West Bank. According to the World Bank, the occupation of Area C costs the Palestinian economy 35 percent of its annual GDP ($5 Billion in 2017).

The West Bank lost at least 10 percent of its most fertile land to the construction of the 712-kilometre Israeli barrier which lies either on, or to the East of, the June 1967 borders. In January 2015 alone, 5,600 productive fruit trees were uprooted or vandalised, this in addition to uprooting more than 2.5 million productive trees (including 800,000 olive trees) since 1967.

Palestinians are prohibited from maintaining or drilling groundwater wells, while Israel extracts more than what is stipulated by the 1993 Oslo Accords and confiscates 82 percent of Palestinian groundwater, forcing Palestinians to buy their own water from Israel to cover 50 percent of their consumption.

Israel also does not allow Palestinians to utilise the natural gas fields off the coast of Gaza and denies them the right to explore oil and gas in both Gaza and the West Bank.

In Gaza, Palestinians are denied access to half of the arable area and 85 percent of their fishery resources. According to UNCTAD reports, the direct damage of the three Israeli military operations on Gaza between 2008-2014 is no less than the value of what was produced by the Gaza Strip in three years.

It is estimated that the wars of 2008 and 2009 destroyed more than 60 percent of Gaza’s productive base, while the 2014 military strikes destroyed 85 percent of what was left. But the total cost of destruction is much higher if the indirect costs of loss of human capital and future revenues from the destructed productive base are considered.

UNCTAD preliminary estimates suggest that the cost of occupation is worth at least the production of the Palestinian economy in a whole year. In other words, if there is no occupation, the economy of the occupied Palestinian territory could produce at least double what it produces now.

However, it should be stressed that the sources of all previous estimates are studies that were not conducted in a single and comprehensive framework that collects, surveys, assesses, makes an inventory and documents all types of direct and indirect costs of the occupation in all sectors of the economy.

What is certain is that all previous estimates scratch only the surface of enormous and accumulated costs incurred by the Palestinian people because of the Israeli occupation.

At this point it is important to emphases that: firstly, any estimate of the costs of occupation cannot and should not be considered under any circumstance a price for the occupation or as an alternative for its termination; secondly, any estimate of the cost of occupation cannot be but a partial estimate, since there are costs that cannot have monetary value, such as the loss of homeland, human life, culture, shelter or the loss of the community; thirdly the purpose of assessing the cost of occupation should not only be for the estimation of the damage incurred by, and for documenting the rights of, the Palestinian people, but it should also be for identifying the resources and developmental needs necessary to reverse the damage and the destructive impact of the occupation.

The reports and resolutions of the United Nations call for the need to establish, and secure the necessary resources to establish, a framework within the United Nations system capable of accomplishing three complex, interrelated and massive tasks: first, historical surveying, registration and periodic updating, in all sectors of the economy and society, of any action or measure by the occupying power that might have economic costs or a harmful impact on the Palestinian people; second, estimating and updating the historical, recurrent and new economic costs of these measures periodically and systematically, based on an evidence-based and scientific methodology; and third, documenting these costs and rights in annual United Nations reports that could be considered as international, legal and historical references.

The information that could be obtained from a framework that “surveys, estimates, documents the costs of the occupation and rights of the Palestinian people,” is an essential reference that should be consulted to facilitate the success of any current or future negotiations. Without this information, a just solution to the question of Palestine and its people cannot be reached, a comprehensive and lasting peace in the Middle East cannot be reached, and the “Deal of the Century”, or the deal of any century, cannot succeed.

*The writer is an economist with the United Nations

*This article expresses the opinion of the writer and not necessarily the position of the United Nations


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