Good news: West Bank is booming
With the news emanating from the Middle East being dominated by the failure of the world to deal with Iran's nuclear programme, the continuing financial crisis in Dubai and the recent spat between Israel and the US over construction in Jerusalem, very little attention is being paid to the economic situation in the West Bank.
It may therefore come as a surprise to many to discover that the economic picture in the Palestinian cities and towns under the control of President Mahmood Abbas's government is actually quite positive.
Indeed, the International Monetary Fund projected that growth for the West Bank in 2009 would come out at 7 per cent (with a similar figure forecast for this year) and, according to the Palestinian Central Bureau for Statistics, industrial production for the West Bank in January 2010 increased by almost 12 per cent over the previous year.
Other economic indicators are also looking good. The number of hotel guests in the Palestinian Territories rose in Q4 2009 by 21 per cent over the corresponding period in 2008 and several new development projects have been announced, including commercial, industrial and tourist-oriented facilities worth US$1.3bn.
In relative terms, the West Bank is booming. An indication of how far things have changed was the recent London roadshow organised by the Palestine Securities Exchange (PSE), in conjunction with The Portland Trust. It featured telecoms, real estate, financial and pharmaceutical companies.
In fact, of 36 PSE listed companies which have released preliminary results for 2009, 30 reported profits and 26 showed a better performance in 2009 than 2008.
Whilst the PSE may not be on the verge of rivalling the LSE as a global stock market, the idea that international investors would consider investing in such companies would have been unthinkable only a few years ago. It seems a world away from the days of the second intifada.
Whilst the current prospects for a long-term peace settlement between Israelis and Palestinians do not appear particularly favourable, the fact that conditions on the ground have changed in many parts of the West Bank to such an extent that people can conduct business and improve their livelihoods must be regarded as good news and clearly preferable to the launch of another intifada. It also provides a very stark contrast to the economic situation in Gaza.
Jonathan Morris is a partner at the international law firm Berwin Leighton Paisner LLP