RAMALLAH, November 22 (JMCC) - An academic study has found that Palestinian businesspeople invest twice as much (between $2.5 and $5.8 billion a year) in Israeli settlements and Israel than they do in the occupied West Bank,
reports Haaretz.
This remarkable finding by graduate student Issa Smeirat shows that even under the most conservative estimate, Palestinians could have benefited from 213,000 additional jobs had these investments been made in the West Bank.
Surveying hundreds of businesspeople, Smeirat said that much less of this investment comes from East Jerusalem, where bureaucracy rules might be easier but residents are relatively impoverished.
Businesspeople in the West Bank are driven to invest in Israel and the settlements by better access to resources and a stronger legal climate, the study found.
Israeli control of 60 percent of the area of the West Bank, its control of the water sources, the restrictions on the movement of people and goods within and outside the West Bank, the Israeli market's blockage of Palestinian goods, the lengthy process of importing raw materials from abroad and of exporting - all these limitations mean the Palestinian manufacturers' inputs are much higher than the Israelis'. Land for leasing or purchase is more expensive because of its scarcity, water and electricity cost more and a Palestinian manufacturer's waiting time for raw materials is longer than that of his Israeli counterpart. Therefore production in the PA areas of the West Bank are more expensive by 30 to 40 percent than production in neighboring countries.
These are the main reasons impelling wealthy Palestinians to invest in Israel. At the same time, investors are also pushed into Israel because of the weakness of the Palestinian law and court system, incompetent management and a tax system they say does not encourage investment. They are attracted by the geographic proximity to Israel, the friendly and more experienced business environment in Israel, Israel's developed international trade relations, easy access to banks and familiarity with Israeli society and how it works (as compared to unfamiliarity with the system in other states ).