Journal Article
Economic Aspects of the Palestinian-Israeli Conflict

Since October 2000 Israel and the Palestinians of the West Bank and Gaza Strip have become entangled in a bloody confrontation. This paper focuses on the economic relationship between the Israeli economy and the Palestinian economy of the West Bank and Gaza Strip, and the ways in which this has contributed to the collapse of the Oslo Accord. The paper finds that Israeli policies have distorted and weakened the Palestinian economy, particularly in the areas of trade (dependence upon one major trade partner), taxation (loss of revenues to finance development spending) as well as in the labour market (controls on labour flows) and in Palestinian access to land (including land confiscation). As a result, besides income compression, poverty and unemployment have risen in the Palestinian territories. Two central issues of the conflict need to be addressed: the Palestinian right to sovereignty over their land and their right to free their economy from colonial dependency on Israel.