The proposal has been compiled after co-operation between the Palestinian government, local trade bodies and hotel associations.

The focus of the plan, which will be put forward at the Palestine Investment Conference in Bethlehem from 21-23 May, will be on East Jerusalem and Bethlehem, the main tourist sites in the West Bank where the Palestinian National Authority (PA) can build.

Nafez Hirbawi, chairman of Palestinian private sector trade body Paltrade, says the existing hotels in these two cities are operating near capacity, and that new investment is urgently needed to take advantage of this vital revenue stream.

“Tourism has been a critical sector to Palestine in the past but in 2007, occupancy of hotels in Bethlehem and Jerusalem was around 90 per cent,” he says. “It is very important that we bring investment into the hotel sector now.”

However, many question this assessment and say money should be invested in improving the hotels which are already there.

“Tourism in Bethlehem has been destroyed by the wall [Israel’s security barrier]. Apart from Christmas and Easter, the hotels are empty, and the standard of service is very poor so everyone stays in West Jerusalem,” says one local businessman.

“We do not need more capacity. If we are going to invest in hotels, it should be to train and improve the existing standard of service to try and bring people back despite the restrictions.”