GAZA CITY has always looked like a construction project gone wrong and never completed. The concrete skeletons of future multi-storey blocks tower above the potholed streets of this city of 350,000, waiting to be fitted out for their future residents. Self rule has stirred hopes that refugee camp residents can finally have proper homes and building activity is booming.

Housing is not the only priority and the sewage that regularly seeps on to the streets is a constant reminder of the city's water and waste water problems. Fortunately, the issue is already being addressed.

Italconsult of Italy has a contract to design a waste water system for 50,000-60,000 people in Shati refugee camp. Two studies for systems to serve Jabalia and the Middle refugee camps around Gaza city have also been completed by the UK/Danish Carl-Bro Haiste International and the Netherlands' DHV Water & Environment.

Other projects include the EU-backed $57 million sewerage project in Rafah that will eventually serve a population of 250,000 and a series of water projects being backed by Germany through the UN Relief & Works Agency for Palestine Refugees in the Near East (UNRWA) in the West Bank municipalities of Bethlehem, Ramallah and Nablus.

Housing is receiving some foreign assistance too but local developers will have an important role to play. 'As the Palestinian Housing Council (PHC) we cannot solve the housing problem without activating the private sector,' says Abdel Rahman Hamad, vice-chairman of the council. If all the refugees in the camps in Gaza alone are to be housed properly, between 70,000-80,000 new homes will need to be built, Hamad says. This will cost about $2,800 million, or $400 million more than the total pledges made by the international community in Washington last year to support the first five years of self rule. If returning Palestinians are to be housed as well, the PHC estimates that 250,000 new homes will have to be built over the next 10 years.

Donors are already supporting some projects. In July, PLO Chairman Yasser Arafat laid the foundation stone for a USAID project to build six tower blocks, at a cost of $7 million, in the Jabalia area. Japan is backing a $20 million scheme to build 300 homes for the Palestinian police force. The EU has committed about $50 million over the past three years towards its housing programme, and has allocated ECU 10 million for 1994.

Some of the aid money will support private construction and local construction firms. The USAID budget for housing sector projects in 1994 is $25 million, but over two-thirds of this will be devoted to projects to support private initiatives.

Investment ideas

The expected building boom is also stimulating investment ideas in the construction industries. Demand for cement is projected to rise to between 700,000 and 1 million tonnes a year and there are two West Bank cement plant proposals.

Until then cement will be imported from Israel or Egypt. A new Egyptian/local joint venture, Arab Contractors Palestine (Osman Ahmad Osman & Al-Farra), is planning to import 50,000 tonnes of Egyptian cement which will be cheaper than its Israeli equivalent. The firm hopes that this will be the start of a lucrative import business.

The transport sector is another Palestinian priority. About $10 million worth of road projects should go ahead this year under the World Bank's $1,200 million emergency assistance programme. If the projects proceed all at once, asphalt will be in short supply from local sources, opening the way for Israeli suppliers. 'Israeli contractors may make a killing overtly or through subcontracting,' says one international consultant.

Some of the bigger contracts are already going to international firms. The PNA signed a provisional contract on 12 August with the group led by the Netherlands' Ballast Nedam to build a $60 million port off the coast of Gaza. The French firm Societe Generale d'Entreprises has a design and supervision contract for airports in both the West Bank and Gaza. An Italian consortium has a letter of intent to build them.

The Palestinians hope to see the smaller projects go to their own people. Under terms agreed by the Palestinian Economic Council for Development & Reconstruction and the World Bank, projects worth less than $3 million will be open only to local companies. Projects of this size could still prove challenging.

But there is room for optimism. 'There is no shortage of professional people. But there hasn't been anything to build,' says John Nicholl of the UK's Mivan Overseas which is building the $19 million, 232-bed Khan Younis hospital. Nicholl says local firms are quick to pick up the skills they have missed acquiring during 27 years of isolation. With more prospects for building appearing every day, there will be no shortage of opportunities to display those capabilities.