Development in Palestine: toward a vision

The Palestinian economy has been operating far below its enormous poten-tial. Overall the economic performance of through 1994-1997 was weak, characterized by negative growth rates, declining per capita incomes and rising unemployment. A variety of factors contributed to this trend, most no-tably the Israeli policy of border closure and other restrictions on the mobility of goods and people. As a result, the initial experience of the peace process for many Palestinians was one of declining living standards. Ultimately a mutually advantageous resolution of political uncertainties is necessary for the economy to embark on a path of strong and sustained growth (Stiglitz, 1999: xi)