Budgets
The economic effects of restricted access to land in the West Bank
Economic activity in the West Bank stifled by restrictions to movement of people and access to natural resources
Authors:
Publisher:
World Bank, 2008
In developing countries, land often provides a foundation for economic activities in a variety of sectors. In the West Bank, it takes on a particular significance as economic activity is stifled by conflict and much of the land area is inaccessible due to Israeli restrictions on movement of people and access to natural resources.
This policy note aims at analysing the channels through which land access restrictions and market distortions constrain productive and public sector investment, and, trace their effects on the development of key economic sectors (construction, agriculture, industry, tourism).
The note finds that, since the year 2000, the economy in the West Bank has been in steady decline, and poverty is on the increase. Foreign aid has done little more than slow down deterioration of the economy, despite ever larger volumes. Although the Palestinian Authority can do more to improve its governance in all aspects of land management (land use, development planning and public land allocation,) as long as there are Israeli restrictions to access to land and water resources and movement, and the majority of the West Bank remains mostly inaccessible for Palestinian economic investment, the investment climate will remain unfavourable and business opportunities minimal.
[adapted from the authors]
