Financing the de-development
By: George Kurzom
Exclusive to Environment and Development Horizons:
Since the 1990s and to date, real financing of development has been absent. Most donor funds to the PA have been and are being spent on covering current expenditures, especially the salaries of employees in the inflated governmental bureaucratic apparatus, as well as covering the current deficit in the public budget. This means that donor funds have practically augmented the consumer and service-oriented structure of the Palestinian economy, ultimately deepening the state of de-development. Any developmental impact of external aid or investments should be measured by the extent of development in the productive sectors (particularly agriculture and industry) and consequently the contribution this development of productive sectors makes in reinforcing national sovereignty over food.
There are mainly political and strategic reasons behind overall donors’ reluctance to make serious investment in the productive economy in general and in agriculture in particular. Agriculture is integrally linked to land and water, which are under the full control of the occupation and which form the essence of the conflict between the Palestinian people and the occupation. Moreover, the fund flow to the West Bank and Gaza Strip has to go through the Israeli system and needs to obtain its approval. Therefore, it is quite natural that this system would not allow investing external funds in a genuine, integrated developmental agro-ecological project, which may involve a comprehensive expansion of the agricultural sector, reclamation of further agricultural areas, and increasing the production and internal marketing in quantitative and qualitative terms before thinking of external marketing. This would mean focusing the agricultural development action on producing basic foods for the local popular segments, which would lead to sustainability and promote Palestinian productive sovereignty over the land. Certainly such policy will in essence contradict the Zionist project that aims to strengthen and perpetuate Zionist “sovereignty” over land and natural resources.
During the period 1993-2013, official foreign “development” support and official foreign assistance to the PA exceeded USD 27 billion (the exact number is US 27,352,110,000). Overall, the majority of assistance has been spent on emergency activities and supporting PA budgets. For example, during 2005-2009, around 60.6% of external grants and assistance were used to support PA budget, 12.8% for emergency programs, while the share of agriculture did not exceed 0.9%. Furthermore, the share of the agricultural sector in PA budgets over the past twenty years has not generally exceeded 1%. In 2014, the Ministry of Agriculture (MOA) share of total expenditure in the Palestinian budget was around 0.7% (USD 27 million out of USD 3.860 billion). The share of the Ministry of Education and Ministry of Health was 18.7% and 13.3% respectively (USD 722 million and USD 512 million respectively). In contrast, the expenditure of the security sector accounted for 28% of total expenditure in the public budget during 2014 (according to data issued by the Ministry of Finance). In 2016 budget, totaling USD 4.25 billion, the security sector alone consumes 28%. Moreover, the proportion of expenditure on the security sector constitutes 45% of total current expenditure, while 1% is allocated to the agricultural sector.