The $7.7bn pledged by international donors to assist the Palestinian economy in December last year makes the Occupied Territories the fifth-most aid-dependent nation on earth.
While this money is invaluable in the short term, it is distorting the balance of the economy and discouraging the long-term development of the private sector that is essential if the country is ever to stand on its own feet.
The balance of the workforce remains heavily skewed towards the public sector, and the availability of foreign funds has prompted the birth of hundreds of non-governmental organisations that pay better than a start-up private business. There is little opportunity and less incentive for Palestinians to join the private sector.
The Palestine Investment Conference in Bethlehem on 21-23 May marks the beginning of a renewed effort to move the economy away from a reliance on foreign aid and to bring new investment opportunities to the table. The $1.7bn worth of projects to be put forward at the event is paltry compared with those tendered every day in the Gulf. But, if successful, their value would far exceed the mere financial.
The sympathy for the Palestinian cause throughout the Middle East is unwavering, and GCC nations were among the most generous donors in Paris. However, what is needed now are Arab investors willing to take the risk of investing directly in the Occupied Territories, creating jobs and sustainable economic development, inviting further investment and forging an upward cycle of business confidence.
Inevitably, Israel will have much to say about the success of these projects. However, Bethlehem offers an opportunity to showcase the Palestinian economy functioning as best it can despite the many restrictions imposed upon it – and making the case for a speedier end to the occupation.