(MENAFN - Saudi Press Agency) The World Bank warned Wednesday of a deepening fiscal crisis in the Palestinian territories and appealed to donors to act urgently to prop up the Western-backed Palestinian Authority, AP reported.
The bank said the finances of the Palestinian Authority, which governs Palestinian areas of the West Bank, have been hurt by reduced donor funding; higher-than-expected spending on pensions and loans; and a revenue shortfall sparked by an economic slowdown.
In a new report, the bank concluded that sustainable Palestinian economic
growth requires strong private sector investment. But it warned that such development is hampered badly because Israel heavily restricts Palestinian access to 60 percent of the West Bank.
Much of the West Bank's farmland and land reserves are located in that territory, which remains under full Israeli control.
'Donors do need to act urgently in the face of a serious fiscal crisis facing the PA in the short term,' said Mariam Sherman, World Bank Country director for the West Bank and Gaza.
'But even with this financial support, sustainable economic growth cannot be achieved without a removal of the barriers preventing private sector development,' she added.