The Palestinian Authority, which is working toward global recognition of its statehood in September, got an endorsement on Wednesday from the International Monetary Fund, which said that the authority was fully capable of running the economy of an independent state.
The fund issued its latest report on the economies of the West Bank and Gaza, to be presented next week to a donors’ conference in Brussels. It said for the first time that it viewed the authority as “now able to conduct the sound economic policies expected of a future well-functioning Palestinian state, given its solid track record in reforms and institution-building in the public finance and financial areas.”
The World Bank, which will be reporting at the same conference, will make a similar point, one that it made last fall.
“If the Palestinian Authority maintains its performance in institution-building and delivery of public services, it is well positioned for the establishment of a state at any point in the near future,” the World Bank says in its report, to be released Thursday.
Salam Fayyad, the Palestinian prime minister, said Tuesday that his government was “in the home stretch” of state building, what he called “our rendezvous with freedom.” He was taking part in a ceremony in the West Bank city of Ramallah to mark the opening of a new venture capital fund that has raised more than $28 million for the West Bank.
Both the World Bank and the International Monetary Fund estimated the Palestinian areas’ real G.D.P. growth at around 9 percent in 2010. They attributed the growth to structural reforms and rigorous budget preparations by the Palestinian Authority, as well as the easing of Israeli restrictions in the West Bank and Gaza, and donor aid.
But both worried about overdependence on foreign aid and said that the current growth rate could not continue without further easing of Israeli restrictions in the West Bank and Gaza.
The authors of the World Bank report noted, “Aid is what keeps many Palestinians above the poverty line, particularly in Gaza, where unemployment is still 37.4 percent and a staggering 71 percent of the population benefited from some form of social assistance in 2009.”
They added that sustainable growth was dependent on a vibrant private sector, which they said was “unlikely to emerge while Israeli restrictions on access to natural resources and markets remain in place, and as long as investors are deterred by the increased cost of business associated with the closure regime.”
Gaza, run by Hamas, has been under Israeli economic boycott for several years and suffered an Israeli military invasion two years ago aimed at stopping rocket fire. Since last fall, Israel has promised to allow more exports and large projects that produce jobs, but progress has been slow.
The Palestinian Authority, which runs the West Bank, announced in September 2009 that in two years it would be institutionally ready for statehood, and it is sticking to that timetable.
Israel occupies the West Bank and argues that unless the Palestinians negotiate over borders and security, no state can rise. In addition, it says, with Gaza run by Hamas, the divisions between the parts of a future Palestine make statehood a dubious proposition in the short term.
But the Palestinians have been building support internationally. Next week they hope that at a meeting of the so-called Quartet — the United Nations, the European Union, the United States and Russia — an endorsement of negotiations based on the 1967 lines will emerge.
The Israelis are opposed to that and seem to have some American support. Prime Minister Benjamin Netanyahu is traveling to Berlin on Thursday, hoping to persuade Chancellor Angela Merkel that a statement on the 1967 lines would be counterproductive because it would permit the Palestinians to avoid real negotiation.
The Palestinians say that if September comes and nothing has changed they will apply to the United Nations for membership.
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