Radio Islam logo

Zionism         Judaism         Jewish Power         Revisionism         Islam         About         Home

Encyclopedia of the Palestine Problem

Chapter Nineteen


The exact parallel between Nazi Germany's willful destruction of the economies within Axis-occupied Europe, and Israel's willful destruction of the economy of the Palestinians in the West Bank and Gaza is of fundamental importance.

The destruction of the economies of Nazi-occupied Europe was not implemented solely for the purpose of exploiting the assets and labor of the occupied nations. It was not simply transitory wanton destruction in acts of war. It was for the purpose of expanding the Third Reich through the integration of the territories of occupied nations into Nazi Germany and utilizing the destruction of the economies of the indigent inhabitants as a prelude to their expulsion.

After the fall of France in 1940, Alsace-Lorraine was incorporated into the Third Reich. The economy of the indigenous Frenchmen of that province was willfully destroyed as a prelude to their planned expulsion. In 1941, following the Nazi occupation of Yugoslavia, part of Slovenia was incorporated into the Third Reich. The economy of the indigenous Slovenes was willfully destroyed by the German Government as a prelude to their planned expulsion into neighboring Croatia.

The International Military Tribunal for the Trial of German Major War Criminals stated in its Judgement:

The evidence established that the territories occupied by Nazi Germany were exploited for the German war effort in the most ruthless way, without consideration of the local economy, and in consequence of a deliberate design and policy. There was in truth a systematic plunder of public or private property, which was criminal under Article 6 (b) of the Charter. The German occupation policy was clearly stated in a speech made by the defendant Goering on the 6th August, 1942, to the various German authorities in charge of the occupied territories:

"God knows, you are not sent out there to work for the welfare of the people in your charge, but to get the utmost out of them, so that the German people can live. That is what I expect of your exertions. This everlasting concern about foreign people must cease now, once and for all. I have here before me reports on what you are expected to deliver. It is nothing at all, when I consider your territories. It makes no difference to me in this connection if you say that your people will starve."

The methods employed to exploit the resources of the occupied territories to the full varied from country to country. In some of the occupied countries in the East and the West, this exploitation was carried out within the framework of the existing economic structure. The local industries were put under German supervision, and the distribution of war materials was rigidly controlled. The industries thought to be of value to the German war effort were compelled tocontinue, and most of the rest were closed down altogether. Raw materials and the finished products alike were confiscated for the needs of the German industry. As early as the 19th October, 1939, the defendant Goering had issued a directive giving detailed instructions for the administration of the occupied territories; it provided:

"The task for the economic treatment of the various administrative regions is different, depending on whether the country is involved which will be incorporated politically into the German Reich, or whether we will deal with the Government- General, which in all probability will not be made apart of Germany. In the first mentioned territories, the ... safeguarding of all their productive facilities and supplies must be aimed at, as well as acomplete incorporation into the Greater German economic system, at the earliest possible time. On the other hand, there must be removed from the territories of the Government-General all raw materials, scrap materials, machines, etc., which are of use for the German war economy. Enterprises which are not absolutely necessary for the meagre maintenance of the naked existence of the population must be transferred to Germany, unless such transfer would require an unreasonably long period of time, and would make it more practicable to exploit theseenterprises by giving them German orders, to be executed at their present location."

As a consequence of this order, agricultural products, raw materials needed by German factories, machine tools, transportation equipment, other finished products and even foreign securities and holdings of foreign exchange were all requisitioned and sent to Germany. These resources were requisitioned in a manner out of all proportion to the economic resources of those countries, and resultedin famine, inflation and an active black market. At first the German occupation authorities attempted to suppress the black market, because it was a channel of distribution keeping local products out of German hands. When attempts at suppression failed, a German purchasing agency was organised to make purchases for Germany on the black market, thus carrying out the assurance made by the defendant Goering that it was 'necessary that all should know that if there is to be famine anywhere, it shall in no case be in Germany."

In many of the occupied countries of the East and the West, the authorities maintained the pretence of paying for all the property which they seized. This elaborate pretence of payment merely disguised the fact that the goods sent to Germany from these occupied countries were paid for by the occupied countries themselves, either by the device of excessive occupation costs or by forced loans in return for a credit balance on a "clearing account" which was an account merely in name. (1)


The facts stated by the International Military Tribunal regarding the war crime of destruction by the Nazis of the economy of occupied Europe apply in toto to the Zionist crime of destroying the economy of the Palestinians from 1948-1967 in 80% of Palestine and in the West Bank and Gaza from 1967- 1989.

Between 1948 and 1967 the Zionists expelled 800,000 Palestinians. They occupied 526 Palestinian small towns and villages as well as four mixed cities and towns and eight wholly Arab large towns and cities. They totally destroyed and erased from the map of Palestine 425 small towns and villages and 67 Bedouin localities, and usurped all their houses and lands and converted them into Jewish settlements. They usurped most of the lands in the other 101 small towns and villages which remained in Israel, in many cases usurping 50% to 75% of the land. They also usurped 95% of the houses, apartments and commercial buildings in the 12 large towns and cities they occupied.

Between I967 and 1989 the Zionists expelled more than 300,000 Palestinians from the West Bank and Gaza, usurped 65% of their lands and 95% of their water resources, established 165 Jewish settlements on usurped Palestinian land and destroyed the economy of the Palestinians as a prelude to their expulsion and the annexation of the West Rank and Gaza to Israel.

The Israeli government imposed deliberate, premeditated and willful stagnation of the Palestinian Arabs' economy. Because the Zionists "operate according to ideological norms and not according to the constraints of economic rationality, Jewish settlements in outlying areas have enjoyed piped water, high-tension power lines, paved roads and industrial growth, while Arab villages, located no more inconveniently with regard to previously existing infra~tructural facilities, have been bypassed.'' (2)

Palestinian farmers in the pre- 1967 Zionist occupied part of Palestine have been deliberately discriminated against as well, to bring about their economic destruction. In Palestine water is a key index for agricultural prosperity, and "Arab farmers, who cultivated over 20 percent of the crop area in 1974- 1975, received only 2 percent of the water allocated for agriculture."(3)

If there should be any doubt about the premeditation behind the willful destruction of the economy of the Palestinian Arabs of pre- 1967 occupied Palestine, Yitshak Oded, probably the foremost authority on land policies in Israel as they relate to Palestinian Arab villagers, states:

New legislation, administrative regulations and executive policies and procedures have been focused on restricting or altering the legdl basis on which the Arab villagers could claim land and on cutting down land already held by them. Consistent, systematic Israeli policy seems to have one purpose: to strike at the tottering land base of the country's Arab population. (4)

Another index of the deliberate destruction of the economy of Palestinian Arabs is shown in the deprivation of their educational facilities in pre-1967 occupied Palestinian territory. "Estimates of the shortage of classrooms in Arab villages in 1977 ranged from 4,500 to 6,000. The increasingly seveE shortage of classrooms has forced most Arab schools to rent rooms in private homes scattered throughout their villages.''(5) It is axiomatic that education and economic development go band in hand. For that reason the Nazis tried to cripple the educational opportunities of "inferior people" in Axis-occupied Europe. For that reason, the Israeli government tries to cripple educational opportunities for Palestinian Arabs.

Just as Hermann Goering openly proclaimed his policy of the displacement of the indigenous inhabitants of territories occupied by Germany, so Shimon Peres, when he was director general of the Ministry of Defense in 1962, said:

By making use of Article 125, on which the Military Government is to a great extent based, we can directly continue the struggle for Jewish settlement and Jewish immigration. (6)

In the context of the infamous Article 125, "Jewish settlement and Jewish immigration" are euphemisms for the economic destruction and subjugation as quasi-slave labor of the Palestinian Arabs of pre-1967 occupied Palestine.

As summarized by Ian Lustick, Israeli government policies are "implemented explicitly for the purpose of discouraging rapid Arab economic development," and the Israeli regime simultaneousfy uses "techniques and instrumentalities to bring the dependence of the Arab economy on the Jewish population in general and the Jewish regime in particular." (7)

Many Nazi war criminals -politicians, industrialists and military and civilian bureaucrats - were convicted for the execution of the same policies.

The Israeli government has ruthlessly exploited the Palestinian people and the material resources of Occupied Palestine. Nazi Gemmy did exactly the same to Occupied Europe, and for the same purpose: to impoverish and depopulate their victims and annex their lands.

The Nazi war criminals engaged in the following acts and practices, among others:

1. They degraded the standard of life of the people of wcupied countries and caused starvation, by stripping occupied countries of foodstuffs for removal to Germany

.2. They seized raw materials and industrial machinery in all of the occupied countries, removed them to Germany and used them in the interest of the German war effort and the German economy.

3. In all the wcupied countries, in varying degrees, they confiscated businesses, plants and other property.

4. In an attempt to give color of legality to illegal acquisitions of property, they forced owners of Goperty to go through the forms of "vo1untary" and "IegaY transfers.

5. They established comprehensive controls over the economies of all of the mupied countries and directed their resources, their production and their labor in the interests of the German war economy, depriving the local populations of the products of essential industries.

6. By a variety of financial mechanisms, they despoiled all of the occupied countries of essential commodities and accumulated wealth, debased the local currency systems and disrupted the local economies. They financed extensive purchases in occupied countries through clearing arrangements by which they exacted loans from the occupied countries. They imposed occupation levies, exacted financial contributions, and issued occupation currency, far in excess of occupation costs. They used the excess funds to finance the purchase of business properties and supplies in the occupied countries.

7. They abrogated the rights of the local populations in the occupied portions of the USSR and in Poland and in other countries to develop or manage agricultural and industrial properties, and reserv~d this area for exclusive settlements, development, and ownership by Germans and their so-called racial brethren.

8. In further development of their plan of criminal exploitation, they destroyed industrial cities, cultural monuments, scientific institutions, and property of all types in the occupied temtories to eliminate the possibility of competition with Germany. (8)


All of the acts and practices used by Nazi Germany to turn the economies of Axis Occupied Europe into an extension of the economy of the German Reich have been used by the government of Israel against the Palestinians.

The economy of the West Bank and Gaza has become in effect an extension of the economy of Israel during the 20 years of occupation. The conversion of the economy into the marginality of the Zionist economy has been continuous and deliberate, and the Palestinian population of the temitories has had no say in the decision-making process. The principal criterion for Israeli decisions regarding the occupied temitories' economy has been to strengthen the Israeli economy and to support Zionist political objectives. The economy of the territories looks distorted and artificial, befitting its role as a supporting actor for Israel's needs.(9)

The study of the economic reality of the occupied territories is difficult because all statistical data have been assembled by the occupation authorities who make the utmost efforts to show a positive picture and to give the appearance of "liberal" involvement in the territories.

There are statistical problems as well: the West Bank economy, possessing "substantial agricultural, handicraft, service activities," is difficult to gauge and interpret, particularly when it is undergoing a shift from peasant, "semisubsistence" agriculture to wage employment(10). The baseline data from the 1967 war period, which became the basis of Israel's economic assessments of the West Bank, are unreliable for the following reasons: (1) pre-1967 information is limited, and the West Bank was not differentiated from the East Bank in Jordanian calculations; (2) almost one third of the West Bank population left at the time of the war, and the atmosphere sumounding the 1967 West Bank census conducted by the Israelis was hardly confidence-inspiring for the residents and therefore unlikely to produce full and accurate information; (3) East Jerusalem has been excluded from West Bankstatistics since its annexation by Israel in June 1967; (4) there was a sharp rise in prices on the West Bank as a result of the war and shortages caused by the disruption of supplies from the East Bank.

One example of the difficulties of interpreting economic data concerning the West Bank since the occupation is the annual economic growth rate. Official Israeli statistics showed an annual 18 percent increase overall and a 15 percent increase in per capita income through 1975; a European economist working with the same figures has estimated that for the same time period the real rates, while still impressive, were closer to nine percent overall and six to seven percent per capita, fairly close to the performance of the Jordanian economy at the same time. The second, lower set of figures takes into account the fact that "somewhere around one-half' the total economic increase for the West Bank resulted from employment outside the West Bank, including Israel, during the time period in question. The same analyst has observed, "Growth performance in itself ... will tell us nothing about the political acceptability of the existing situation in principle or about underlying political stability."

The Zionist economic requirements concerning the West Bank - that it not be a financial burden and that its economy not be permitted to compete with Israel's own - were instituted from the outset of the occupation. The exodus of West Bank residents as a result of the fighting created a huge potential agricultural surplus for crops ripening at the same time, but the ingenuity of West Bank farmers in making contact with East Bank markets by fording the Jordan River with their trucks was encouraged once the bridges across the Jordan were rebuilt.(11)


Much confusion has reigned sumounding the objectives of Israel's economic policy. Is it to hamess the Palestinians as de facto slave labor? Or is it to destroy the Palestinians economically so as to facilitate their expulsion and displacement by Jews? The answer is that although these two goals would seem to be contradictory, in fact they are not. The first goal is a tactical one, involving the weakening of Palestinian economic independence by making the Palestinians dependent on the Israeli economy. This, in effect, reducks previously prosperous Palestinian farmers, tradesmen, professionals and workers into a new "lumpen proletariat" to serve as Zionist slave laborers. The second goal is a strategic one, to replace any Palestinian presence by a Jewish one and to even erase the memory of any Palestinian existence on land coveted by the Zionists.

This simultaneous application of tactical and strategic Zionist-oriented economic policies is readily observed through analyses of the socioeconomic characteristics of the West Bank and Gaza.

The simultaneous application of tactical and strategic Nazi-oriented policies in Occupied Poland, Alsace-Lomaine, Slovenia and other parts of Occupied Europe during World War II was similar, i.e. to utilize slave labor of the captive peoples to support the Nazi war machine, while simultaneously driving them out of their homes and land for the benefit of German colonists.

Two major, external sociopolitical systems operate in the West Bank. These are the Israeli and the Jordanian systems. While each of these systems has subsystem compnents, there are other systems operating in the West Bank as well; Americans, Europeans, and other international voluntary agencies have their share in shaping conditions, and indirectly i in providing grounds for extending external outlooks, and 1 sometimes interests. Nevertheless, the Israeli and Jordanian I systems are the most active.(12) In the Gaza Strip, however, the pre-1967 economic system had a mixture of Egyptian and local characteristics.

The Israelis did not come to the occupied territories to soldier for peace or to perform casual entrepreneurial duties. They came as colonisers with the implicit purpose of uprooting the Palestinians. The Israeli system presented the Palestinians with a serious socioeconomic danger, in addition to the political and security challenges.

The Israeli system has these characteristics:

1. Structurally, the Israeli economy is highly commoditized and continuously strains to adapt to international market norms. The amalgamation of Israeli finance with its international counterpart is a separate story. But the 1967 war accelerated the process. The first internationd Jewish conference held in Jerusalem in the wake of the war exposed the readiness of the Israeli establishment to share with international capital the potential benefits of the newly conquered areas. The West Bank and Gaza Strip added almost one million consumers to the Israeli market and provided Israeli industry and agriculture with a relatively big reservoir of cheap labor. This dramatic change in Israel's economic potential led to an aggressive and rigid policy of control vis-a-vis the Palestinians in these territories. The favorable response of internationd capital, especially the U.S. section, to the Israeli offer was a catalyst to the tJ.S.-Israeli strategic agreement of November 1983.

2. The Jewish production system in the private, communal, or public sectors tended toward commoditization from the start. Therefore, the Israeli system, the offspring of the Yeshuv economic system, tended to intensify commoditization and was more aggressive toward the natural economy which characterized the Palestinian production system.

3. As a result of the aforementioned factors, Israel favored advanced technology and intensive production. Research efforts in Israel were oriented toward the intensification of the use of technology.

4. The superiohty of the Israeli system over the Palestinian system and the emergence of a sophisticated industrial, agricultural, and military complex in the former, facilitated Israeli dominance over the West Bank and the integration of its economy into the Israeli framework.

5. Israeli expansionist policy generated mushrooming desires for further expansion. This collective desire found expression in the official Israeli policy and prompted a biblical justification from the religious establishment. Israel was faced with the problems of maintaining control over the occupied territories and satisfying the demands of Israeli pressure groups at the same time.

6. Israel has overextended its military commitment, hence straining its economy and deepening its dependence on the United States. This defeats the claim that Israel was not created as an outpost for intemational capital.(13)


Despite occupation and domination of the Palestinian economy by the Israeli economy and Israeli policies, the Palestinian economic system was not completely eradicated. The Palestinians were able, with their hard work, abilities and sacrifices, to maintain an economic system of their own.

A study of the gross domestic product {GDP) reveals that agriculture and trade scored the highest figures in 1965, each amounting to almost 24 percent of the GDP, Industry covered only 6.6 percent. While 35.4 percent of the profitmaking inhabitants were engaged in agriculture and 28.6 percent were craftsmen and laborers (skilled and unskilled), the 36 percent remaining were employed in other types of services. Services, largely tourism, contributed generously in promoting credit, and almost the same amount accrued from remittances in 1965. Remittances from abroad in that year amounted to Jordanian Dinars {JD) 6,398,000 (JD = appmximately $2.8). Per capita income from this source alone was JD 7.1. The ratio of remittances to the total private per capita income was 10.6 percent.

Industry received little attention from Jordanprior to 1967. Despite the fact that the West Bank accounted for almost half the population of the State, its share of the country's industrial activity did not exceed 22 percent.(14)

Until 1967 West Bank industry was characterized by small workshops employing between one and nine workers. It was traditional and lacked innovation. The making of soap, olive oil processing, and traditional handicraft in Bethlehem were the main aggregate components. As a gesture of support, the Jordanian government bought shares in only one company established in the West Bankup to 1967. Incontrast, it bought shares in eighteen companies based in the East Bank up to 1964. The govemment's share in supporting West Bank industry did not exceed 3.2 percent of its total pafiicipation in the industrial capital of the country.

The human resources of the West Bank exceeded the resources of its stagnating economy. Emigration was an established historical phenomenon. Migration from the mountainous area to the coastal plain was the main trend among the internal migrants from World War I until 1948. The agricultural and industrial development which took place between World War I and World War II continued to attract a great number of inhabitants until the outbreak of hostilities in 1948. The high mobility the West Bankers displayed contributed to their flexibility and sophistication. It also contributed to their vulnerability. Internal emigration from the West Bank to the coastal plain was halted after 1948.

Out-migration to the East Bank and the Gulf Area was Willjiul Destruction ofthe Pulestiniua Economy in the West Bunk and Guzu Strip 561 enhanced under the duress of the deteriorating conditions and the need in Gulf States for skilled workers. The transfers of these emigrants contributed generously to the gross income, but generated economic laxity on the part of the Jordanian authority to develop the West Bank and established partial dependency among the ihabitants at the same time.

The 1967 war brought to light the defects and dangers of the migration phenomenon. Upon implementation of the "open bridge" policy, 200,000 Palestinians (almost a quarter of the total population) left the area across the bridges. Emigration, however, slowed down by September 1967.(15)

The annexation of Jerusalem to Israel, the "open bridge'' policy, and the institution of "open borders" between Israel and the West Bank and Gaza Strip had far-reaching effects on the occupied territory.

The annexation of Jerusalem, surrounding it with Jewish settlements, and establishing a Jewish belt between the Mediterranean and Jordan River initiated a process of ghettoization of the West Bankers in separated island-like entities.

Constraints and limitations on the normal development of the Occupied Territories' economy and society laid down by the Israelis added new barriers to existing ones. They discouraged the emergence of an antithetical indigenous system and rendered relationships among the Palestinian desultory. A scrutiny of the systems of control used by Zionists shows that their systems of control rest on four major items: authority, land, water, and energy.

Notwithstanding that authority was guaranteed by virtue of the rights Israel enjoyed as a belligerent power, it further enjoyed the advantage of using the nondemocratic section of the Jordanian Corpus Juris. Not satisfied with that, it introduced more than one thousand military orders in the last seventeen years to tighten its control on every aspect of human activity in the West Bank.

In Nazi occupied France we find that French farmers who were independent landowners were dispossessed and tumed into laborers. The same has been done by the Zionists to the Palestinian landowners, many of whom are now common laborers.

The indictment of the Nazi war criminals concerning this policy of theirs reads:

In France in the Departments of the Aisne, the Nord, the Meuithe and Moselle, and especially in that of the Ardennes, rural properties were seized by a German state organization which tried to have them exploited under German direction; the landowners of these exploitations were dispossessed and tumed into agricultural labourers.(16)


In the Occupied West Bank and Gaza the destructive influence of the Ismeli occupation of the temtories can be seen by examining the Israeli exploitation of the indigenous Palestinian Arab labor force.

It is necessary to examine briefly the population of the West Bank and the Gaza Strip as sources of labor. At the end of 1985 the population of the occupied temtories was 1,387,100 of whom 767,300 resided in the West Bank, 493,700 in the Gaza Strip and North Sinai, and 126,100 in East Jerusalem. (Israeli official data on the population of the occupied territories include North Sinai, whose citizens are Egyptian, but since they are few, they do not significantly affect the situation as a whole).

The population structure of the occupied territories has the same characteristics that prevail in most developing countries. The Table below shows that approximately half the population is below fourteen years of age and does not participate officially in economic activity.(17)

There is a peculiarity in the population growth of the West Bank. Contrary to the experience of the majority of developing countries, the population of the West Bank has witnessed a decline during the past twenty-five years. Despite a natural increase of approximately 3Opr 1 ,000people, the population of the area at the end of 1977, according to official Israeli statistics (68 1,250), wm smaller than in 1 952 (686,000). This was mainly due to successive waves of emigration: local migration to the East Bank of Jordan before 1967, the exodus directly after the war of 1967, and the departure of thousands of job-seekers since.

The resulting imbalance in the population of the West Bank is reflected in its sex/age composition. There are fewer young adults and middle-aged people than might be expected. In particular, there is a marked absence of men: at the end of 1977 there were only about 787 men per 1,000 women of the age group 25-44 in the West Bank. This ratio is even smaller inall the occupied territories: 757 men per 1,000 women. This factor has had an adverse effect on the structure of the labor force; female participation in the labor force is still at a low level.

As in other developing countries, the rate of participation in the labor force of people aged fourteen and over is low, as may be seen in the following table:


Age Group Total Males Females
Total 100.0 100.0 100.0
0- 14 46.8 49.2 44.4
15 -29 27.3 28.2 26.4
30-44 11.4 9.3 13.5
45-64 10.3 9.2 11.4
65 + 4.2 4.1 4.3

Source: StatisticuI Abstract of Israel (SAI) No. 29,1978, p.766, table 27-3.

The low participation of those who do not seek work although they are of an age to do so is attributed to various factors. Chief among these are (1) The low participation of women in the labor market, either because they are needed at home or because of traditions that discourage them from joining in the labor market. Official statistics show that in 1976-64.3 percent of women aged fourteen and over in the West Bank, and 80.7 percent in the Gaza Strip were housewives. Recent years have witnessed a slight trend toward more participation of women in the labor market, especially in the West Bank* (2) The relatively high percentage of young people attending schools and universities; in 1976, 24.78 percent of the population aged fourteen and over in the West Bank and the Gaza Strip were involved in various stages of learning.

One of the most significant changes in the West Bank's economic and social strucmre since the occupation has been the employment of West Bank workers in the Israeli economy, either within the "Green Line'' (the previous Israel- Jordan armistice line) or in the West Bank for Israeli employers. Starting in 1967 with 5,000 West Bank workers, the number rose to 88.500 in 1983, of whom 63,500 were registered, not including 15,000 fiom East Jerusalem or 15,000 working in the West Bank in subcontracting work for Israeli employers. The "boom5' years in Israel lasted until 1974, but employment patterns were well established by then (the employment of Gaza workers in Israel reached 55,000, of whom 40,200 were registered), and the relative turndown in the economy has not had a major impact on the West Bank worker situation.(18)

More than half of the West Bank workers in Israel are in construction, with approximately 2Opercent in industry. They make up several categories, the first of which includes those officially employed, many of whom have been working for the same employer for more than ten years. These workers, who receive some social benefits from the system, are usually landless and often from West Bank refugee camps. The second category is groups of workers that are engaged through a local labor contractor, usually an Arab who handles the negotiations with employers on behalf of the group. These groups often stay together and move from job to job, having little personal contact with Israelis in the process. Some of these workers have farm land which they must tend during growing periods and for which they must be able to take time off from their jobs in Israel. They are unwilling to tie themselves down to a single job in Israel if it means they can't take care of their crops. The third category is the informal labor market for day workers that has developed as West Bank residents gather at customary locations in the towns, often before dawn, and await the arrival of Israeli van and pickup truck drivers who call out their worker needs and choose from among the many Palestinians available.

West Bank workers are not permitted to join Histadrut, the all-embracing Israeli labor union, although those that are officially registered w workers in Israel are entitled to medical and other benefits. Despite the fact that Israeli employers collect the full range of employee benefit deductions from the West Bankers' pay checks, only a tiny fraction of those entitled to pensions have received them, and a large sum of money representing unpaid benefits has built up in Israel and has apparently been utilizd for benefits to Israeli workers. Only in recent times has the proposal been made that the funds be put to work in the West Bank to benefit those from whose wages they were deducted. "Casual" workers in Israel receive neither social benefits nor wdges equal to their registered fellow Palestinians, who in turn receive a lower rate of pay than Israelis engaged in the same activity. (West Bank workers do participate in labor unions in the West Bank, however. At present there are an estimated 25 unions with a membership of 40,000).(19)

West Bank workers in Israel hold the menial jobs that Israelis are ever more reluctant to take. This situation puts the West Bankers at the bottom of the social and economic scale in Israel. Israeli regulations prohibit West Bankers from staying overnight in Israel, but many do so either because of the distance they must commute or employer preference. In either case their living arrangements are usually rough and lacking in amenities, often filthy and even dangerous since some employers lock them in at night to avoid detection. Fires in rooms locked from the outside have taken the lives of several West Bank workers in recent years.

The employment of West Bank workers in Israel has had dramatic far-reaching effects in the West Bank, however. By opening up opportunitics for wage employment for many of the underemployed or unemployed, it virtually wiped out the problems in the West Bank by 1974. The money it put into workers' hands has created a consumption splurge that still goes on.

Another significant impact, albeit of a different nature, of the new economic security of a large part of the West Bank underclass has been a reduction in the influence of the traditional landowning class that often employed, advanced credit to, and helped arrange affairs for the workers. This change has been reflected as well in the demand for a greater say in village affairs by workers whose economic base is now outside the village.

The increase in individual standards of living for many rural West Bank workers through jobs in Israel since the occupation has often been at the expense of community well-being because farm hands have not been available to tend the crops. As a result of the shift many villages and individual farmers have abandoned their fields and now have to purchase agricultural commodities previously grown at home.


Until 1981/82 agriculture was the most productive and stable branch of the Palestinian economic sector. During the period under review, however, the share of agriculture in the West Bank GDP shows a continuous decline. This decline, which reflects a decline in actual pmduction and in the value of production in real terms, can neither be explained by drought nor by the biennial nature of the olive crop (the mainstay of Palestinian farming). It can only be attributed to decreased productivity.(20)

Until 1981/2 the level of production increased steadily despite a constant decline in the number employed in the sector, from 42% to 33% in 1980/1 and 28.5% in 1984 (of Palestinians employed in the West Bank). The production-employment ratio pointed to an appreciable rise in productivity. Productivity has risen due to changes of methods of cultivation, increased mechanization, technological innovation, investment in expertise and capital, a decrease in disguised unemployment in agriculture, phasing out of marginal cultivated areas and replacement of low-value by high-value cash crops.

All these developments came about without any radical change in the resource base of Palestinian farming. There was no increase in available land nor in the area under irrigation. Support systems, such as marketing and credits, remained rudimentary. Palestinian farming developed successfully within its existing constraints and only insofar as it would not affect Israeli agriculture and on condition that its development would not involve a fiscal or economic drain on the Israeli economy or government. Palestinian agriculture has been made to fit into the Israeli system and to adjust itself to the demands of the integrated economy created by Israel. Its total dependence on the Israeli economy is reflected in fluctuations of growth rates in Palestinian farming, which regularly correspond to fluctuations in the Israeli sector. The economic stagnation in Israel, and the severe crisis in its agricultural branch, which persisted into the early '80's, adversely affected Palestinian agriculture, which lacks the massive protection enjoyed by Israeli farmers, and is therefore powerless to compete with them.

It seems that in the mid-'80's Palestinian farming could not function properly any longer within the constraints imposed by Israel, and its productivity declined. Due to the centrality of cultivation in the Palestinian economy, this is bound to have a long-term impact on the viability of the entire Palestinian sector and on Palestinian society at large.

The overall cultivated area in 1982-4 remained within the range of areas cultivated since 1968, i.e. 1.7 - 1.6 million dunums. In 1983 it reached the highest point in 17 years - 1.722 million dunums. In 1984 it was reduced by 8.0% to 1.584 million dunums. In 1984 the area under cultivation by region was as follows.

Southern region (Hebron, Bethlehem, Ramallah subdistricts): total area - 532,400 d.; irrigated - 2,900 d.; field crops - 147,700 d.; fruits (rain-fed) - 356,700 d.

Northern area (Nablus, Jenin, Tulkarm subdistricts): total area - 954,000 d.; irrigated - 50,100 d.; field crops - 232,500 d.; fruits (rain-fed) - 64 1,100 d.

Jordan Valley: total area - 48,300 d., all imgated; vegetables - 30,800 d.; fruits - 7,900 d.

The major drop in cultivation occurred in field crops (more than 20%) and in imgated areas (6%). The increase in orchards (including olives) was a modest 2%.

1984 was the worst agricultural year in a decade, due to a severe drought, uneven distribution of rainfall and a warm winter. As a result, field crop yields declined by 36%, cash crops by 5.7% and citrus by 9.6%. On the other hand watermelon crops increased 6.5% and fruits 15.3%. The olive crop, although higher than in 1983 (a nonproductive year due to the biennial cycle) was 35% lower than 1982. The value of agricultural production in 1984 was about $250 million, compared with about $300 million in 1983 and $320 million in 1982. This constant decline should be seen against the annual average rate of increase in value of agricultural production between 1968- 198 1, amounting to 9.6%.

During the period under review there has been no increase in the total value of purchased input, compared with the previous year. Vegetable yield was consumed (with an additional 18% supplied to the area from Israel) in the area (58%), in Jordan (35%) and the rest in East Jerusalem. Some 35% of the fruit crop was exported to Jordan (excluding olives).

Worsening conditions in the Israeli sector and large-scale unauthorized marketing of West Bank produce in Israel prompted the authorities to employ strict production quotas and marketing control. Production quotas have been set for Palestinian farmers in the Jordan Valley (eggplants and tomatoes), and no marketing permits for supply to Israel were granted. In September 1984 the authorities decided to impose "integrated and comprehensive production planning for vegetable production in Israel, the West Bank and Gaza." This entailed imposing a quota system on Palestinian farmers, according to seasonal supply and demand forecasts.

The new policy meant that Palestinian farmers whose water quotas have been fixed for more than a decade at an irrigated area of 100,000 dunums and who pay almost four times more for water than Israeli farmers, and lack marketing and credit facilities and subsidized purchased input, are made to conform to the constraints of the Israeli agricultural sector, with obvious and disastrous consequences.

Palestinian entrepreneurs, however, are deeply involved in Israeli agricultural production. In recent years Israeli farmers increasingly chose to sell their crops (especially vegetable and fruits) before the harvest, to sub-lease their fields after sewing ("daman") or sell their marketing quotas to Palestinian traders and contractors.


The Israeli occupation and settlement policies have had a serious impact on a crucial factor of production - water. At present, farming is dependent on relatively low and erratic rainfall levels. The village well provides water for domestic purposes and for irrigated vegetables and fruit growing where this exists. Only about 4 percent of total land under cultivation is irrigated (about 81,000 dunums).(21) Irrigated land is mostly found in the Jordan Valley and in pockets in the Jenin and Tulkarm areas.

Expanding irrigation would be an obvious way to raise productivity and improve agricultural income but Israeli water policies have generally blocked this development. In the first place, the Israelis have no interest in seeing a prosperous Palestinian agricultural sector on the West Bank which might compete too much with her own. Second, Israel itself has a very high rate of water use, particularly for its heavily irrigated agricultural sector which uses up some 75 percent of the total volume of water consumed each year. The coastal water table is now in danger of salinification from heavy use, and almost one-third of Israel's present water resources are derived from ground water in an aquifer lying under the Western slopes of the West Bank.

This has given the Israelis a clear stake in maintaining control over this source of water. The Israeli proposals for "autonomy" in the territories from 1978 onwards have therefore always stressed that water as well as land would be excluded from its terms. In 1979, Israeli Water Commissioner Meir Ben Meir emphasized that by 1985 on existing calculations Israel would have a considerable water deficit and could not do without the West Bank aquifer. This clearly makes control over West Bank resources crucial not just to prevent the Palestinians from developing the economy independently but also to fill Israeli water needs. The only long-term alternative, in Ben Meir's view, is costly desalination programs, which would make agricultural water expensive and thus make Israeli produce less competitive on the market. Hence, he asserted, development of West Bank agriculture (settlements excepted) could only occur at the expense of Israeli agriculture. Hence strict controls have been placed on water use, domestic and agricultural. The vast majority of villages in the West Bank and many towns suffer from water shortages in the dry summer months every year.(22) Wells are metered and those who pump over the stated limit are penalized. The authorities also generally forbid the drilling of new wells.(23)

Settlements, by contrast, are not restricted in their use of water and are permitted to drill deep wells. In the Jordan valley region, where underground water is vital for agriculture, this appears to have led in several cases to the drying up or reduction in flow of shallower neighboring village wells. Among the best documented cases are those of al-Auja in the central part of the valley and Bardala in the northern sector. A report from the military government's water department in 1978 gives the following picture of this unequal situation:

1. Total number of artesian wells in the West Bank is 331, of which 17 have been drilled by the Israeli water company (Mekorot) in the Jordan Valley to serve Israeli settlements in that area.

2. 12 Arab wells have dried up after occupation. Many others in the Jordan Valley (mostly in the northern part) are suffering a declining water table and increased salinity.

3. Total volume of water discharged from 3 14 Arab wells amounted in 197718 to 33.0 million cumic metres (mcm). Whereas 17 Israeli wells in the Jordan Valley have discharged in the same season 14.1 mcm.(24)

The Jordanian government meanwhile estimates that the water available to West Bankers from all sources amounts to 105 mcm a year, less than one-sixth of the area's total water resources.

In the Gaza Strip the water situation for agriculture is even more serious, since a greater proportion (45 percent) of agricultural land, mostly growing citrus, relies on irrigation. Heavy use due to the overpopulation of the Strip, combined with the demands of agriculture and the growing number of Jewish settlements using irrigation, is straining the water table to its limits and there are fears that the aquifer will become saline if remedial measures are not taken soon. Aid officials in the areas reportedly state that the Israelis' outposts' profligate irrigation practices have greatly increased the pressure on resources.

As it is, local plantations have their water use strictly controlled. Meters are placed "on the wells in orange groves of the Arab inhabitants in order to limit the water supply to them - for instance, only 10 cubic metres per dunum. Any Arab who was entitled to only 10 cubic metres and took more was punished by having his water supply cut off."(25)

Most of the West Bank area is part of the Israeli hydrological system. About a quarter of Israel's annual water potential originates from beyond the Green Line (some 475 million cubic meters per year out of 1.900 million cubic meters). This is the basis for the Israeli claim that control over West Bank water potential must remain in Israeli hands in all circumstances. Otherwise, Israel argues, the entire Israeli system, already overpumping water, will collapse.

The total underground water potential of the West Bank is estimated at 600 million cubic meters per year. About 125 million cubic meters of this are situated east of the watershed and therefore do not affect Israeli potential. The western water table (Yarkon-Taninim), with a capacity of 335 million cubic meters per year, and the northeastern water table (Gilboa-Beit She'an), which collects some 140 million cubic meters per year, directly affect Israeli potential.

Of this joint potential, Israel uses the vast majority of the water and the West Bank only about 20 million cubic meters per year (1982). According to estimates, Israel is overpumping these water tables, so that the main water potential of the West Bank, shared with Israel, is exploited to its limit, in a ratio of 4.5% to the West Bank and 95.5% to Israel. In the eastern water tables (Samaria, Nablus-Jenin, Wadi Fari'ah, Wadi Baydun, Patzael, and Fash'a) some 80 million cubic meters are used by the Palestinians, including 20 million cubic meters on the mountain plateau and about 50-60 million cubic meters in the Jordan Valley and its eastern slope. Some 30 million cubic meters from the same water table are used by the Israeli agricultural settlements in the Jordan Valley, part of which is supplied by sources outside the region. There is a water surplus in the eastern tables, but the authorities have not permitted the residents of the West Bank to expand the utilization of their water sources. Total water consumption of the Palestinian sector in the West Bank reached some 115 million cubic meters per year at the beginning of the 1980's, of which some 100 million cubic meters are for irrigation and the rest for domestic and industrial use.


Go to part 2


Encyclopedia of the Palestine Problem
By Issa Nakhleh

Return to Table of Contents