Last updated: 4 February, 2014

Palestinian PM sets $4.2 billion 2014 budget

Palestinian prime minister Rami Hamdallah presented Tuesday a draft budget for 2014 of $4.2 billion (3.1 billion euros) with a deficit of $1.3 billion, a statement read.

As in previous years, the budget anticipates considerable foreign aid, expected to reach $1.6 billion (1.2 billion euros), a slight rise from 2013.

The bulk of the budget was running expenditure, estimated to reach $3.9 billion (2.9 billion euros), with $2 billion (1.5 billion euros) to be spent on salaries and pensions, an increase of 4.9 percent compared to 2013.

The salaries are primarily financed by tax and tariff funds levied by Israel on goods destined for Palestinian markets that pass through Israeli ports it transfers to the Palestinian Authority at approximately $121 million (90 million euros) a month.

In a September report to donor states, the PA stressed that “without an end to the Israeli occupation… and its prohibitive restrictions… private sector-driven sustainable economic growth is unattainable.”

A World Bank report from October said the economy could grow by more than a third, if Israel lifted restrictions on about 60 percent of the West Bank it controls, assessing the current losses to the Palestinian economy at about $3.4 billion (2.5 billion euros).