U.N.: Palestinian Economy in Ruins
Fri Aug 30, 5:16 AM ET
By STEVEN GUTKIN, Associated Press Writer

JERUSALEM (AP) - Israeli restrictions have caused "deeper and broader"
economic fallout in Palestinian territories than previously thought, with
unemployment reaching 50 percent and poverty in the Gaza Strip ( news - web
sites) at 70 percent, the U.N. envoy to the Middle East said Thursday.

Terje Roed-Larsen urged Israel to ease its restrictions in the West Bank and
Gaza Strip and called on both sides to resume peace talks as the only
viable solution to the current Mideast impasse.

Roed-Larsen said the statistics were the first international numbers on the
Palestinian economy since Israel reoccupied major Palestinian urban areas
last spring in response to suicide bombings.

"I am deeply disturbed by the figures," Roed-Larsen said. "But I am not
surprised, given the iron grip that Israel has imposed on the West Bank."

Israel has imposed curfews and sealed off much of the West Bank, severely
restricting the movement of people and goods. Residents of six of the eight
major urban areas in the West Bank are confined to their homes, often for
days at a time.

Roed-Larsen said the curfews and closures have pushed up unemployment in the
West Bank in the second quarter of 2002 from 36 percent to 50 percent.
Unemployment in Gaza, he said, has remained steady at 50 percent.

According to U.N. figures, poverty, defined as per capita consumption of $2
or less per day, is 70 percent in Gaza and 55 percent in the West Bank.

Since last March, 56 percent of Palestinian households lost at least half
their income, and about 20 percent lost all their income, according to the
Palestinian Central Bureau of Statistics.

"Aid cannot fill the gap, but without it the economy would collapse. Against
this backdrop, and before the eyes of the world, the Palestinian civilian
population is scrambling to survive."

The U.N. envoy acknowledged that easing restrictions could pose new security
risks to Israel, but he said failing to do so will fuel the very extremism
Israel is trying to quell.

"We have to break through this central dilemma," Roed-Larsen said.
Humanitarian, economic, political and security issues must be negotiated at
the same time, he said, or cease-fires will be destined to fail.

Israel says the measures are necessary to prevent Palestinian terrorists
from entering Israel. More than 250 Israelis have died in suicide bombings
since U.S. brokered peace talks broke down two years ago, setting off a
cycle of attacks and counterattacks.

Roed-Larsen said he appreciated Israel's "very legitimate" security
concerns, but said the effects of Israeli restrictions are "deeper and
broader than many people had thought."

The envoy said in the next few days he will meet with Israeli officials and
urge them "to re-examine the application of their security measures."