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World Bank Pledges Continued Strong Support to the Palestinian People

Press Release No:97/46S
Contact: Abdallah Bouhabib (202) 473-4784
Klas Bergman (202) 473-3798

WASHINGTON, September 6, 1996 World Bank President James D. Wolfensohn today met with Dr. Nabeel Sha'ath, Palestinian Minister of Planning and International Cooperation, and other members of a Palestinian delegation. The meeting took place following the September 5 session of the Ad Hoc Liaison Committee (AHLC) on Palestinian Assistance, of which the World Bank is the Secretariat.

Mr. Wolfensohn welcomed the historic meeting between Prime Minister Netanyahu and President Arafat of September 4, observing that this meeting had established a more favorable atmosphere for addressing the critical problems that face the Palestinian economy.

The Bank has committed US$135 million to support the international effort and, with the support of the Bank's Board, will continue and even intensify this effort. The economic package is a vital element of the peace accords between the Palestinians and the Israelis.

The projects financed by the World Bank, and others under preparation by the donor community, will be presented and discussed in the forthcoming Consultative Group (CG) meeting for the West Bank and Gaza, to be held on November 19, 1996.

The AHLC meeting was notified that about US$2.2 billion of the US$2.9 billion pledged to the Palestinians since the signing of the Declaration of Principles had now been committed. Additional commitments are expected at the CG in November. Total disbursements have reached more than US$1 billion, though disbursements for 1996 are lagging: only US$287 million this year so far, as compared with a 1996 target of US$500 million.

Unemployment is a huge economic problem in the West Bank and Gaza, and the Bank will continue to finance employment-generating projects from its own resources as well as working with donors who want to target their contribution to employment generation.

The Bank also believes there is an urgent need to create a favorable legal and incentive environment for the private sector in the West Bank and Gaza in order to attract the capital that is vital to sustained growth and a long-term reduction in unemployment. Finally, it is equally urgent for all sides involved to clarify the rules of the game pertaining to the movement of people and goods, so that private economic activity can develop.


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