Tuesday, November 06, 2007


The chart traces the path of GDP and Foreign Aid in the Palestinian Authority since the Oslo Accords. Would it be too daring to assume that the pink and blue lines will continue to diverge? A GDP does not a country make. But it sure is difficult to have one without.

This article claims that the Peace Dividend (if it is ever paid) will be of far more benefit to the Palestinians than to Israel. This one looks more closely at the GDP/Aid question, and includes this quote:

The assessments of none other than George Abed, a Palestinian and senior IMF economist, and of James Prince, a consultant to the Palestinian Investment Fund, offer an important summary of the phenomenon of increased aid correlating with economic deterioration. Abed recognized the futility of providing donor aid, asserting that it was counterproductive. What was needed, he said, was investment. This view was echoed in Prince's conclusion that, "many of the donor programs have not only been ineffective, they have harmed the economy." ( "Expert says Palestinians don't need financial aid," San Francisco Chronicle, Sept. 5, 2005).

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