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The Fence: A Palestinian Economic Perspective

18 August 2002

By Yisrael Ne’eman

Volumes have been written on the importance (or lack thereof) of the security fence being built between Israel and West Bank (Judea and Samaria).  It certainly could not keep out an army but then  its intent is only to keep out terrorists, supposedly.  Most likely it will cut back seriously on

suicide/homicide bombings.

Although it has been mentioned in these columns, barely anything is being written publicly about the socio-economic impact of the fence on the Palestinians.  With the collapse of the hopelessly corrupt Palestinian Authority leadership there are no reliable economic statistics concerning Arab life in the West Bank and Gaza.  But as noted on occasion, tens of thousands of Palestinians work illegally in Israel, thereby letting steam out of the economic pressure cooker where millions of Palestinians are trapped.  Israeli authorities are fully aware of the situation and were fearful of an irreversible despair that could increase terrorism beyond anyones wildest nightmares.

Today the Palestinian economy is estimated to be worth less than $1 billion annually.  Much of the money comes from illegal work in Israel, how much, no one really knows.  To make the math simple one can estimate that at any given time there are 25,000 Palestinians working in Israel receiving $20 for a 12 hour day, usually in agriculture (well below minimum wage).  This adds up to $500,000 a day to be multiplied by 350 (several days taken off for Moslem and/or Jewish holidays) and gives us a total of $175 million, worth somewhere between 20 to 25% of the Palestinian GNP and all non taxable net pay, being used immediately to feed impoverished families. 

The fence will eliminate these workers from the off the books list of the Palestinian employed.  A social explosion will ensue, one which previously Israel feared.  But the government must stop the bombers and figures it cannot be hated any more than it already is by the Palestinians.  Also demonstrations by unemployed Gazans (already surrounded by a fence) who used to work in Israel, are blaming Arafat and Sharon equally for their woes, in essence meaning a condemnation of Arafat and the PA. 

Israel hopes the social explosion will be directed against the corrupt PA elite, including Arafat himself who is being accused by Israeli intelligence of hiding a personal fortune of $1.3 billion (considered a conservative estimate by many) in secret bank accounts and investments.  It remains to be seen if documentation to prove the charges will be made public. 

Besides a tool to stop terrorism the fence is another device in Israels hands to corner the PA leadership and either force them into moderation or bring about their demise.