March 27, 2002	Wednesday	Muharram 12, 1423

PARIS: A study issued in Paris by the World Bank estimates that the first 15 months of the second Intifada have cost more than 1.3 billion dollars in direct and indirect damage to the Palestinian territories.

The cost breaks down into 305 million dollars worth of direct damage to physical infrastructure located in Palestine - much of it financed by member countries of the World Bank - and “more than one billion dollars” worth of lost revenues, the result of Israeli occupation of the territories.

During the same amount of time, says the study, Palestine was able to report a Gross domestic product of only 2.4 billion dollars. Tax collections also declined significantly - this also the result of the Israeli occupation - to 20 million dollars per month last year, one-fifth of what the total had been only a year earlier. The result being, says the report, that Palestine is “effectively bankrupt.”

The study, which deals with the overall situation of the economy of the Palestinian territories, also reveals that last year Palestine experienced a seven per cent drop in its Gross Domestic Product (as opposed to -6 per cent the previous year), and saw its unemployment rate soar to 48 per cent, close to four times what it had been the year before.

Its conclusions confirm the warning that had been issued last year by COFACE, the French agency that rates countries according to their risk situations. COFACE, which provides insurance cover for companies that want to engage in trade with high-risk countries, had already indicated last year that Palestine “was already down on its knees, as a result of the second Intifada, bringing about an important decline in tourism and investments, indeed the suspension of contracts already in force.”

But it is the size of the physical damage inflicted on the Palestinian territories by Tsahal during the first 15 months of the second Intifada that the study deals with in particular, corroborating results of a January 2002 meeting of the European Union that estimated that Israel was directly responsible at the time for more than 20 million euros (18 million dollars) worth of damage to EU-financed facilities located in the Palestinian territories.

At the time, the EU warned Israel that if the practice should continue, the EU could very well decide to call for a boycott of Israeli exports to the 15 European Union member countries.

In its just-issued report on Palestine, the World Bank also sent out a few warnings of its own to Israel, putting the Israeli government of Prime Minister Ariel Sharon on notice that “any significant resuscitation of the Palestinian economy requires that the Israeli government dismantle its present system of internal controls and restrictions on the movements of goods and workers.”

In the words of one of the authors of the report, Nigel Roberts, who heads the World Bank office in Palestine, “ if Israeli occupation of the territories continues or is intensified, the Palestinian economy will just crumble.” This to be followed, in his words, by “more despair, more privations, and more hate.” The report also suggests that outside investors be called on to inject more money into the Palestinian economy, but that is an appeal that is most likely to fall on deaf ears, suggests Roberts.

Although last January representatives of the 15 nations that make up the European Union had held an important meeting in Brussels to make known the size of the damage caused by Israel to the various infrastructure facilities in the territories that were financed by the EU - at a cost of three billion euros (2.7 billion dollars) - in the end, none of the members chose to go through with an outright condemnation of the practice.

Representatives like Schussel had encouraged the EU to demand that Israel “put an immediate stop to the practice” of destroying Palestinian infrastructure, indeed had proposed that Israel be asked to indemnify the EU for the more than 20 million euros (18 million dollars) worth of damage it has caused so far to EU-financed facilities in the Palestinian territories.

But, because of intense lobbying by countries like Italy, which has decided to align itself on Washington with regard to the EU’s position on Israel, nothing ever came of the proposed measures.

This, in spite of the revelations made at the EU meeting that Israel was systematically destroying EU-financed infrastructure. At the time, the straw that hat broke the camel’s back was Tsahal’s destruction in mid-January of the offices of the Voice of Palestine, and the seizure of the station’s broadcast equipment. The station had been created as the result of a joint 6 million euros (5.4 million dollars) grant from the EU’s two principal members, France and Germany.

Also revealed at the meeting was the destruction by Tsahal of several other EU-financed facilities, among them Gaza Airport, financed by Germany, Sweden and Spain at a cost of 9.3 million euros (8.4 million dollars), whose runway and radar equipment were destroyed on December 5 and 15 of last year and on Jan 10.

Other major EU-financed structures destroyed by Israel included three civil police camps located in Gaza that represent a EU-financed investment of 2.05 million euros (1.85 million dollars) that were bombed between August and December of last year, as well as a medico-legal laboratory, financed by France, Sweden and Greece at a cost of 718,000 euros (645,000 dollars) that was destroyed in December.