Palestinians Protest Amid Economic Hardship

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Last week, Palestinians vented their frustration against what they perceive as mismanagement of the economy by Palestinian Authority President Mahmoud Abbas and Prime Minister Salam Fayyad.  Angry at news of rising taxes and fuel price hikes, protestors demanded the resignation of both PA leaders in demonstrations that mirrored anti-austerity outrage in other countries currently going through a difficult economic period. The furor has since died down, but it appears to have given an impetus to several initiatives aimed at ameliorating the situation of the Palestinians in the West Bank and Gaza.

One of these initiatives came before a group of donors attended by several members of the UN Security Council, as well as the UN Quartet’s Special Envoy for the Middle East Tony Blair and Palestinian Authority and Israeli government officials. The main subject of that discussion was the development of Gaza offshore gas fields, an issue that, according to an AP report published on Jordan Times, “has been on hold for years, with Israel and the Palestinians at odds over the project, despite international interest in exploiting the field. The situation is additionally complicated by Palestinian internal divisions. …Israel…has at times publicly suggested it could purchase gas from the field. But on other occasions it has disputed Palestinian sovereignty over the area.”

Despite this announcement, the events of the last two weeks have been cause for much reflection, especially on the Palestinian side. For example, Ghassan Khatib, a former PA spokesman, cautions that despite the lull in violence “another blow-up is just around the corner. President Abbas seems to know this and has demanded in two urgent meetings that the leadership either declare the agreements with Israel null and void, or call immediate presidential and legislative elections. But his options are very limited. If the crushing nature of the Israeli occupation and the seeming indifference of the donor community persist, the next emergency could easily bring the Palestinian Authority to its end. Such a collapse will certainly transform the reigning atmosphere of calm into chaos and complete uncertainty, which will have widespread negative consequences for all.”

Not everyone feels that the phasing out of the PA would be such a bad thing. In an op-ed for the Palestinian Amin News, Ramzy Baroud is heartened by the recent protests and believes “While they are not indicative of a Palestinian version of the ‘Arab Spring,’ they are still an important first step….For years, Abbas and Fayyad oversaw the financial transaction, which was more of a pyramid scheme than a state-building measure….How long the PA can continue to operate as a functionary of Israel and Western interests will now largely depend on Palestinians. Even if more money is pumped into PA coffers, the fundamental problem will not go away. Bribing a nation with meager handouts to deny them political rights is superfluous at best, and it will most certainly not last.”

Miftah’s Joharah Baker agrees with Baroud that the PA is guilty of mismanagement “but not as much as Israel….. If the protests are taken in this framework, the calls for Prime Minister Salam Fayyad to step down and the public outrage against the government seem perfectly appropriate. But the fact of the matter is that Palestine is not Greece, or Italy or Germany and its government is neither sovereign nor independent…. So, the problem is manifold. The PA should take stock of its internal affairs and manage its finances better, but without an end to the Israeli occupation and these horrible agreements that have shackled the Palestinians hand and foot, no removal of Salam Fayyad or even President Abbas will solve the problem.”

It is obvious to most observers as well as officials in Israel and the Palestinian Authority that the deteriorating situation in the Occupied Territories is not conducive to the stability of either the Palestinians or the Israelis. According to a Palestinian news agency Maan News, “The Palestinian Authority finance minister (Nabil Kassis) warned on Sunday that if the government’s fragile financial situation persists, the peace process between Israel and Palestinians is at risk….The meeting…was also attended by Israel’s Deputy Foreign Minister Danny Ayalon and the head of the IDF’s defense department in charge of West Bank civil affairs. Ayalon warned ‘the more the Authority uses this assistance for funding terror, and continues the unilateral steps, the more this cooperation is in danger.’”

In Israel there are mixed feelings regarding how much of the blame is shouldered by the PA and how much can be attributed to Israeli policies in the Occupied Territories. On one hand, in two separate editorials dedicated to the issue, the Jerusalem Post expresses little doubt who is responsible for the sad state of affairs in West Bank and Gaza: “Numerous factors contribute to making the PA an economic basket case. The notorious corruption at the top is only one. The funds contributed by overseas benefactors are misspent and do not begin to compensate for chronic failures to erect a sound economic foundation….But Ramallah is not only liable for its abject mismanagement and economic parasitism. There is a far more basic issue at stake. It would be very difficult — if not impossible — for a future Palestinian state to function as a separate economy from either Israel or Jordan — between which it is wedged — and Jordan is by no stretch of the imagination a success story either.”

Those arguments followed previous ones aimed at Abbas, arguing “Undoubtedly it is Abbas’ inept leadership that is to blame for the PA’s falling popularity. And only the Palestinian people are to be blamed for failing to support a more moderate, sane political leadership than either Fatah or Hamas has to offer….Perhaps one day the Palestinian people will have the wisdom and courage to support a more moderate political leadership that will be capable of bringing true peace to the region. But until that day comes, Israel must do its best to prevent a dangerous regression on the West Bank.”

However, not everyone feels the Palestinians are the only ones to blame in this matter. Taking aim at the Israeli occupation of Palestinian territory and Israel’s nearly total control over the Palestinian economy, Uri Avnery writes: “Actually, the PA is quite helpless. It is bound by the Paris Protocol, the economic appendix of the Oslo agreement. Under this protocol…the Palestinians cannot fix their own customs duties….But more than any restrictions, it’s the occupation itself that makes any real improvement impossible….Donor nations can give some money to the Palestinian Authority to keep it alive, but they cannot change the situation. Neither would the abolition of the Paris Protocol, as demanded by the demonstrators, change much. As long as the occupation is in place, any progress — if there is any — is conditional and temporary.”

But, as Danny Caravan writes in the Israeli daily Yedioth Ahronoth, it is pointless to speak of preserving or doing away with the Oslo accords, since in effect the Accords might as well be dead: “The peace initiative, had it been accepted, could have turned the Middle East into a flourishing economic paradise, encouraged democratic forces in the region and allowed Israel to form a coalition of Arab states against Iran. But Israel’s governments did not accept the challenge. Oslo gave Israel wall-to-wall international support, the likes of which it had not seen since the state’s inception…. It’s a shame that Oslo did not bear fruit. It’s a shame that its enemies undermined it.”

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Middle East In Focus is a synopsis of commentary and news from Middle Eastern and other international media. Its purpose is to provide a succinct and balanced summary of the main developments and views that are often overlooked or not properly reflected in the U.S. media. For the most recent collection of articles on and from the Middle East, please go to: Comments and feedback are welcome at

  • Middle East Policy

    Middle East Policy has been one of the world’s most cited publications on the region since its inception in 1982, and our Breaking Analysis series makes high-quality, diverse analysis available to a broader audience.

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