The private sector is labeled as the engine of sustainable economic growth and development in the occupied Palestinian territory (oPt). The Palestinian Reform and Development Plan 2008-2010 calls for the private sector to generate productive employment, produce high value-added goods and services, and create the surplus needed to enhance national prosperity. However, evidence suggests that the private sector in the Gaza Strip finds itself in dire straits, and the obstacles it faces need to be removed, if it is to recover and carry out its role as the key actor stimulating growth.

UNDP/PAPP has commissioned a phone survey targeted at the business community in the Gaza Strip, which was conducted between 4 and 9 December 2007. Three hundred and nineteen businesses in the Gaza Strip were successfully surveyed. The results are staggering and indicate that the private sector in the Gaza Strip is on the verge of collapse with no scope for recovery unless the strict imposed closure regime on the Strip is lifted.

In the near future, UNDP/PAPP will release a full-fledged report on the private sector based on the information gathered. Meanwhile, some of the main findings merit immediate attention if action is to be taken in order to resuscitate the private sector in the Gaza Strip.

More than two years since the Israeli Disengagement from the Gaza Strip, political events have cast a shadow over the then anticipated economic boom. Prior to the January 2006 PLC elections, businesses in the Gaza Strip still functioned at 76% of their production capacity. From January 2006 to June 2007, the production level fell to 46%. Since the political events last June, the closure regime became even tighter, resulting in a further drastic drop in productivity to an average of 11%.

To View the Full Report as PDF (45 KB)