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Economic & Social Monitor ( MAS)
Executive Summary
National Accounts:
GDP
reached US$1,149.5 million in the 4th quarter of
2005, a decline of 2% in comparison to the 3rd
quarter of the year. GDP per capita also
declined in the 4th quarter by 1%, arriving at
US$323 per person during the 3-month period. The
services sector remained the largest contributor
to GDP, with 37.5%.
External Trade:
The
total trade deficit reached US$2,060.6 million
in 2004, an increase of 35.5% over 2003. For the
first time a services trade deficit - of US$1.5
million - was reached in 2004.
Industrial Sector:
In 2004
the total number of industrial establishments
operating in the Palestinian territories
declined by 1,000. Moreover, the total number of
workers in the sector declined by 2% to reach a
total of 59 thousand workers. However, value
added in the sector increased by 36.8% and
industrial exports rose by 60% in the West Bank
and 30% in the Gaza Strip.
Services Sector:
The
total number of establishments operating in the
services sector increased by 49% and value added
increased by 34.2% in 2004. Employment in the
sector increased by 29.9% in the West Bank and
63.5% in the Gaza Strip.
Internal Trade:
The
number of establishments involved in internal
trade increased by 26.3% in 2004, while value
added rose by 26.2%. However, the productivity
of workers in internal trade decreased by 3%.
Hotel Activities:
The
total number of hotels operating in the
Palestinian territories increased to 77 during
the 4th quarter of 2005. Hotel guests increased
by 2.3% over the 3rd quarter, and the number of
workers in the hotel industry increased by 77.
Agricultural Land:
About
26.1% of land plots were damaged - especially
arable land - because of Israeli practices.
Olive presses, which numbered 287 in 2005,
received 27.3 thousand tons of olives and
produced 6.8 thousand tons of olive oil.
Labour Market:
Labour
force participation increased form 40.3% in 2004
to 40.7% in 2005, while female labor force
participation decreased from 13.5% to
13.4%.Unemployment decreased from 26.8% to 23.5%
in the same period. Job vacancy announcements in
the 3 main newspapers numbered 871 in the 1st
quarter of 2006, a 30% decrease from the
previous quarter.
Investment Indicators:
The
number of building licenses issued in the 4th
quarter of 2005 increased by 68.5% in comparison
to the same quarter in 2004, reaching 2,200
licenses. Cement imports also increased during
the same period by 20.2%, reaching 406.9
thousand tons. However, the number of newly
registered companies (166) declined in the 4th
quarter by 18.6% in comparison to the 3rd
quarter of the year.
Public Finance:
Both
public revenues and expenditures increased in
the 4th quarter of 2005, by 47.1% and 11.4%
respectively.
Banking Sector:
The
total assets of banks operating in the
Palestinian Territories increased by 2.2% in the
4th quarter compared to the 3rd quarter of the
year. However, credit facilities declined by
0.4% to reach US$1791.8 million. In the same
period, banks’ foreign investments increased by
6.2% and non-performing loans increased by 1.4%.
Exchange Rate Spread:
The
exchange rate spread in the Palestinian
territories increased from 1.15% in the 3rd
quarter of 2005 to 1.57% to the 4th quarter of
the year.
Palestine Securities Exchange:
Most
market indicators declined sharply during the
1st quarter of 2005: trading volume fell by
38.7% and the Al-Quds index dropped by 46.3%.
Purchasing Power and Inflation:
US dollar and Jordanian Dinar exchange rates
against the Shekel in the Palestinian
territories increased by 2.8% and 2.5%
respectively. The increase in exchange rates was
higher than the increase in the consumer price
index, leading to an increase in purchasing
power by 0.42% for the Dollar and 0.06% for the
Dinar.
Attitudes of Industrial Establishment
Owners/Managers Regarding Economic
Conditions:
Data
indicated an increase in positive attitudes,
with 42.8% of owners and managers optimistic
about conditions of their establishments. They
were also more optimistic regarding employment
levels and increases in sales volumes.
Schooling:
The
total number of school students reached 1.08
million in the school year 2005/2006, an
increase of 3.3% compared to the previous year.
During the past ten years, the number of schools
has increased by an average of 4.5% per year.
Health:
The
total number of health establishments in the
Palestinian territories reached 4,281, of which
75.6% were operated by the private sector. The
total number of employees in the sector reached
26,902, with 41% working in the public sector.
Israeli Measures:
The
total number of those killed in 2005 reached 287
people. Israel continued targeting medical
staff, Palestinian activists, and foreigners
sympathetic to Palestinians. Israel also stepped
up its efforts to isolate Jerusalem from the
rest of the West Bank.
Palestinian Prisoners in Israeli Jails:
The
total numbers of detainees in Israeli prisons
totaled 8,800 at the end of the 4th quarter of
2005, including 350 children and 115 women.
Living Standards and Conditions:
Social and economic conditions continued to
remain difficult during the 4th quarter of 2005,
although some indicators improved slightly. The
percentage of households who lost half of their
income increased in the Gaza Strip to 58.3%,
while a slight improvement took place in the
West Bank. The number of families who could
sustain themselves for another year increased.
Social Assistance:
The
percentage of households who received assistance
during the 4th quarter declined to 27.2%; the
decline was greater in the West Bank than in the
Gaza Strip. There was an increase in the
proportion of monetary and food assistance
handed out to families, which reached 65.1% of
total assistance.
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